Age-One Equivalents (millions)
All Species
                                     614.2
                                     652.0
                                    1,637.5
                                    1,931.0
Forage Species
                                     528.2
                                     560.8
                                    1,258.7
                                    1,459.7
Commercial & Recreational Species
                                     85.9
                                     91.2
                                     378.8
                                     471.3
Commercial & Recreational Harvest (millions of fish)
                                     16.1
                                     17.1
                                     44.7
                                     54.0
A1E Losses with Direct Use Value (%)
                                                                          2.63%
                                                                          2.62%
                                                                          2.73%
                                                                          2.80%
[a] IM&E = impingement and entrainment; A1E= age-one equivalent;
[b] IM&E Effects by Option: Proposal Option 2 = impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 50 mgd; Final Rule = impingement mortality standards based on modified traveling screens for all facilities with flow greater than 2 mgd; Proposal Option 2 = intake flow commensurate with closed-cycle cooling for facilities that have a DIF of greater than 125 mgd and impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 2 mgd.
[c] The totals presented here do not include IM&E reductions associated with new units. Estimated IM&E reductions associated with the new unit provision of the final rule are presented in Exhibit X-4.

      In addition to the final rule and other options analyzed for existing units (Proposal Option 4 and Proposal Option 2), EPA analyzed requirements for new units at existing facilities. EPA's new unit provision in the final rule establishes entrainment requirements for all new stand-alone units at existing facilities. EPA could not directly apply the extrapolation methodology used for existing units because facility-specific information was not available for new units. Instead, EPA estimated impingement mortality and entrainment reductions on the basis of impingement mortality and entrainment reductions per million gallons per day from the analysis of existing units. The estimated reduction in impingement mortality and entrainment for the new unit requirement is summarized in Exhibit X-4.
Exhibit X-4. Annual reductions in IM&E by species category for the final rule for new units
IM&E metric [a]
Reduction in IM&E [b]
Individuals (millions)
All Species
867.2
Forage Species
566.1
Commercial and Recreational Species
301.1
Commercial and Recreational Harvest (millions of fish)
0.1
Lost Individuals with Direct Use Value (%)
0.01%
Age-One Equivalents (millions)
All Species
2.3
Forage Species
1.7
Commercial and Recreational Species
0.7
Commercial and Recreational Harvest (millions of fish)
0.1
A1E Losses with Direct Use Value (%)
2.87%
[a] A1E= age-one equivalent; IM&E = impingement mortality and entrainment
[b] Impingement mortality and entrainment reductions increase throughout the compliance period. The values presented here reflect the peak reductions achieved in 2059, the final year of the compliance period.
IM&E Effects: entrainment requirements for all stand-alone or units.

D.	National Benefits of the Final Rule and Options Considered
1.	Overview
      Economic benefits of the final rule and other options considered for regulated facilities can be categorized broadly into use and nonuse benefits of goods and services. Use values include benefits that pertain to the human use (direct or indirect) of affected fishery resources. Use values reflect the value of all current direct and indirect uses of a good or service. Direct use benefits can be further categorized according to whether affected goods and services are traded in the market (i.e. commercially captured fish are traded, recreational catch is not). Likewise, indirect use benefits can be linked to direct goods and services. For example, reductions in impingement mortality and entrainment of forage fish will enhance the biomass of species targeted for commercial (market) and recreational (nonmarket) uses. It could also affect property values.
      Nonuse benefits are those benefits that are independent of any current or anticipated human use of a resource. Nonuse benefits reflect human values associated with existence and bequest motives. In other words, these values reflect the value the public places on something simply as a result of its existence or natural functioning. EPA estimated the economic benefits from national regulatory options using a range of valuation methods. Commercial fishery benefits were valued using market data. Recreational angling benefits were valued using a benefits transfer approach based on revealed and stated preference data. To estimate indirect use benefits from reduced impingement mortality and entrainment of forage species, EPA used a simple trophic transfer model. This model translated changes in impingement mortality and entrainment of forage fish into changes in the harvest of commercial and recreational species. All benefits for fish saved under today's final rule are estimates on the basis of projected numbers of age-one equivalent fish, converted to harvestable age equivalents on a species-by-species basis for those commercial species analyzed.
      EPA calculated the monetary value of use benefits of the final rule and other options considered for existing facilities using two discount rate values: 3 and 7 percent. All dollar values presented are in 2011 dollars. Because avoided fish deaths occur mainly in fish that are younger than harvestable age (eggs, larvae, and juveniles), the main benefits from avoided impingement mortality and entrainment would be realized typically 3 to 4 years after their avoided death. A detailed description of the approaches used to address this is in Appendix C of the BA.
      Neither forage species nor the unlanded portion of recreational and commercial species were assigned direct use values in this analysis. Their potential value to the public is derived from several alternative sources: their indirect use as both food and breeding population for those fish that are harvested; and nonuse value. The nonuse value includes individuals' WTP (willingness to pay) for the protection of fish based on a sense of altruism, stewardship, bequest, or vicarious consumption; and their support of ecosystem stability and function. To estimate a subset of nonuse benefits from reducing impingement mortality and entrainment of forage species and unlanded commercial and recreational species, EPA conducted a benefits transfer using a nonmarket valuation study of aquatic ecosystem improvements. This effort generated partial estimates of nonuse values for resource changes for a species that represents less than one percent of adverse environmental impacts.
      EPA developed and fielded an original stated preference survey to estimate total WTP for improvements to fishery resources affected by impingement mortality and entrainment from regulated 316(b) facilities (75 FR 42438, July 21, 2010). Preliminary results of the stated preference survey were described in a Notice of Data Availability (77 FR 34927, June 12, 2012). EPA presents preliminary benefits estimates based on the stated preference survey in the BA to demonstrate progress on this effort. In the absence of final survey results, EPA estimated partial nonuse benefits for the final rule using the benefits transfer approach from proposal. EPA updated the proposal results to incorporate additional stock assessment data for winter flounder, the species used as the basis for the analysis. Due to the challenges associated with estimating nonuse benefits, some nonuse benefits are described only qualitatively.
2.	Timing of Benefits
      Discounting refers to the economic conversion of future benefits and costs to their present values, accounting for the fact that individuals value future outcomes less than comparable near-term outcomes. Discounting enables a valid comparison of benefits and costs that occur across different periods. EPA used discounting to account for differences in the timing across benefits and costs under the final rule and options considered. EPA estimated the expected benefits of the final rule once the rule takes full effect, then used discounting to account for delays in the realization of benefits. Two different delays affect the timing of benefits under the final rule and options considered.
      First, facilities will begin to incur costs prior to technology installation. Facilities will face regulatory requirements once the rule is effective, but it will take time for requirements to be developed and for the required technology to be installed. Analyzed facilities are assigned a technology installation year which considers facility characteristics and technology being installed. EPA assumed that facilities installing impingement technology tend to complete technology installation sooner than facilities installing closed-cycle cooling (for other options considered). The assignment of technology installation years is speculative on EPA's part, because EPA does not have sufficient data on hand to project the schedules that Directors will set for facilities. See Chapter 3 of the EA document for the final existing facilities rule for details on EPA's development of technology installation years. EPA effectively discounts benefits to a greater extent than costs to account for the lag between the incurrence of costs and the realization of benefits.
      Second, an additional time lag will result between technology implementation and use values via increased fishery yields. This lag occurs because several years could pass between the time an organism is spared from impingement mortality or entrainment and the time of its potential harvest. For example, a larval fish spared from entrainment (in effect, at age 0) could be caught by a recreational angler at age 3, meaning that a 3-year time lag arises between the incurred technology cost and the realization of the estimated recreational benefit. Likewise, if a 1-year-old fish is spared from impingement and is then harvested by a commercial waterman at age 2, there is a 1-year lag between the incurred cost and the subsequent commercial fishery benefit. To account for this growth period, EPA applied discounting by species groups in each regional study. Note that nonuse values (depending on how they are measured) do not necessarily need to be discounted similarly.
3.	Recreational Fishing Valuation
a.	Recreational Fishery Methods
      To estimate recreational benefits of the final options, EPA developed a benefits transfer approach on the basis of a meta-analysis of recreational fishing valuation studies designed to measure the various factors that determine WTP for catching an additional fish per trip. Regional benefits are summarized as follows (for details, see Chapter 7 of the BA):
   1. Estimate the annual forgone catch of recreational fish (number of fish) attributable to impingement mortality and entrainment under current conditions.
   2. Estimate the marginal value per fish using a benefit transfer function based on a meta-analysis of recreational fishing studies.
   3. Multiply the forgone catch by the marginal value per fish to estimate the total annual value of the forgone catch.
   4. Estimate the annual value of reductions in the forgone catch attributable to the regulatory analysis options.
   5. Discount the time path of benefits at 3 and 7 percent to reflect the time lag between impingement mortality and entrainment reductions and increased harvests.
b.	Estimated Benefits to Recreational Anglers
      Decreasing impingement mortality and entrainment increases the number of fish available to be caught by recreational anglers, thereby increasing angler welfare. Exhibit X-5 shows the estimated benefits resulting from reduced impingement mortality and entrainment under today's final existing facilities rule and other options that EPA considered. The total annualized recreational fishing benefits for all regions at existing units of existing facilities for the final rule (impingement mortality and entrainment combined) are $18 million using a 3 percent discount rate and $14 million using a 7 percent discount rate. Annual recreational fishing benefits for other options considered range from $17 to $43 million using a 3 percent discount rate and $13 million to $30 million using a 7 percent discount rate.
Exhibit X-5. Annual recreational fishing benefits from eliminating or reducing IM&E at existing units at existing facilities for the final rule and other options considered
Regulatory option [a]
                               Increased harvest
                               3% discount rate
                               7% discount rate

                                (million fish)
                                (million 2011$)
                                (million 2011$)
Proposal Option 4
                                      6.1
                                     17.1
                                     12.6
Final Rule  -  Existing Units
                                      6.5
                                     18.2
                                     13.5
Proposal Option 2
                                     20.5
                                     43.0
                                     29.5
Baseline
                                     25.3
                                     78.8
                                     72.0
[a] IM&E Effects by Option: Proposal Option 4 = impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 50 mgd; Final Rule = impingement mortality standards based on modified traveling screens for all facilities with flow greater than 2 mgd; Proposal Option 2 = intake flow commensurate with closed-cycle cooling for facilities that have a DIF of greater than 125 mgd and impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 2 mgd.

4.	Commercial Fishing Valuation
      Reductions in impingement mortality and entrainment at cooling water intake structures are expected to benefit the commercial fishing industry. By reducing the number of fish killed, the number of fish available for harvest is expected to increase. The next section summarizes the methods EPA used to estimate benefits to the commercial fishing sector. The section after that presents the estimated value of commercial fishing benefits.
a.	Commercial Fishing Valuation Methods
      The total loss to the economy from impingement mortality and entrainment impacts on commercially harvested fish species is determined by the sum of changes in both producer and consumer surplus. EPA assumed a linear relationship between stock and harvest, such that if 10 percent of the current commercially targeted stock were harvested, 10 percent of the commercially targeted fish lost to impingement mortality and entrainment would have been harvested absent impingement mortality and entrainment. The percentage of fish harvested is based on data of historical fishing mortality rates.
      Producer surplus provides an estimate of the economic damages to commercial fishers, but welfare changes can also be expected to accrue to final consumers of fish and to commercial consumers (including processors, wholesalers, retailers, and middlemen) if the projected increase in harvest is accompanied by a change in price. The analysis of market impacts involves the following steps (for details, see Chapter 6 of the BA):
   1. Assessing the net welfare changes for fish consumers due to changes in fish harvest and the corresponding change in fish price.
   2. Assessing net welfare changes for fish harvesters due to the change in total revenue, which could be positive or negative.
   3. Calculating the increase in net social benefits when the fish harvest changes by combining the welfare changes for consumers and harvesters.
      For a more detailed description of the methodology for commercial fishing, see Chapter 6 of the BA.
b.	Commercial Fishing Valuation Results
	Exhibit X-6 presents the estimated annual commercial fishing benefits attributable to the proposed options. The results reported include the total reduction in losses in pounds of fish, and the value of this reduction discounted at 3 and 7 percent. Total estimated annualized commercial fishing benefits for the United States for the final rule are $0.9 million using a 3 percent discount rate and $0.7 million using a 7 percent discount rate. Annual commercial fishing benefits for other options considered range from $0.9 million to $3.9 million using a 3 percent discount rate and $0.7 million to $2.7 million using a 7 percent discount rate. EPA estimated the expected price changes from eliminating baseline levels of impingement mortality and entrainment and found them to be small, ranging from 0.2 to 2.5 percent.
Exhibit X-6. Annual commercial fishing benefits from eliminating or reducing IM&E at existing units at existing facilities for the final rule and other options considered
Regulatory option [a]
                               Increased harvest
                               3% discount rate
                               7% discount rate

                                 (million lbs)
                                (million 2011$)
                                (million 2011$)
Proposal Option 4
                                      5.3
                                      0.9
                                      0.7
Final Rule  -  Existing Units
                                      5.7
                                      0.9
                                      0.7
Proposal Option 2
                                     14.0
                                      3.9
                                      2.7
Baseline
                                     17.3
                                      8.0
                                      7.2
[a] IM&E Effects by Option: Proposal Option 4 = impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 50 mgd; Final Rule = impingement mortality standards based on modified traveling screens for all facilities with flow greater than 2 mgd; Proposal Option 2 = intake flow commensurate with closed-cycle cooling for facilities that have a DIF of greater than 125 mgd and impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 2 mgd.

5.	Nonuse Benefits
      Aquatic organisms with no direct use benefits account for the majority of cooling water intake structure losses (Exhibit X-3). Although many individuals may not use a particular waterbody for recreation or fishing, individuals nevertheless may value improvements in that waterbody. To quantitatively assess the ecological gains from the final rule and other options considered, EPA took both of the only two approaches available for quantifying nonuse benefits  -  a benefits transfer approach and a stated preference survey.  It is not necessary to use a stated preference survey approach to calculate benefits; however, important nonuse benefits can be missed by not using a stated preference survey approach.  So EPA took both approaches, but relied on only the benefits transfer approach for the benefits analysis supporting the final rule. The benefits transfer approach relies on the existence of previously published studies with values that can be transferred; in instances where nonuse is potentially significant, as is the case here, previously published studies would only include nonuse value if they adopted a stated preference approach.
      EPA used a benefit transfer approach to partially monetize nonuse benefits associated with reductions in impingement mortality and entrainment of fish, shellfish, and other aquatic organisms under the regulatory options for the North Atlantic and Mid-Atlantic benefits regions. EPA applied estimated values from a study conducted in Rhode Island; these estimates are likely to be more representative of nonuse values held by individuals residing in the Northeast United States and less accurate in other regions. EPA was unable to identify comparable studies conducted in other regions that could be used to estimate nonuse values. Chapter 8 of the BA provides further detail on this analysis.
      The preferred techniques used to estimate total values (including both use and nonuse values), in general, are benefits transfer or to conduct a stated preference survey. There are many studies in the environmental economics literature that quantify benefits or WTP associated with various types of water quality and aquatic habitat changes. However, none of these studies allows the isolation of non-market WTP associated with quantified reductions in impingement mortality and entrainment for forage fish or unlanded portion of commercial and recreational species.
a.	Nonuse Benefits Transfer
      EPA identified a recent stated preference survey of Rhode Island residents that is closely related to the 316(b) policy context. The study results have been published in multiple scientific journals and books including Johnston et al. and Zhao et al. Both the Rhode Island study and the present context address policy changes that increase the number of forage fish in aquatic habitat with unknown effects on overall fish populations. The Rhode Island study was developed originally as a case study addressing Rhode Island residents' preferences for the restoration of migratory fish passage over dams in Rhode Island's Pawtuxet and Wood-Pawcatuck watersheds. It estimates nonuse values by asking respondents to consider changes in ecological indicators reflecting quantity of habitat, abundance of wildlife, ecological condition, and abundance of migratory fish species. Within this study, estimated values were based on the relative change in abundance of fish species most affected by restoration.
      Estimating benefit functions from the Rhode Island choice experiment survey allows one to distinguish benefits associated with resource uses from those associated primarily with nonuse motives. Within the benefit transfer application, WTP is quantified for increases in non-harvested fish alone on the basis of the implicit price for migratory fish changes. This transfer holds constant all effects related to identifiable human uses (e.g., effects on catchable fish, public access, and observable wildlife). The remaining welfare effect -- derived purely from effects on forage fish with little or no direct human use -- may therefore be most accurately characterized as a nonuse benefit realized by households.
      The estimation of nonuse values involved the following steps:
   1. Use a model published by Zhao et al. to estimate household WTP per percent increase in the number of fish in a given watershed. The household WTP values reflect a survey version that characterizes effects on the number of migratory fish passing upstream.
   2. Calculate the relative change in abundance for the fish species most affected by the regulation. The structure of the transfer study dictates that WTP should be evaluated based on the single species that would experience the greatest relative increase in abundance from restoration and that WTP estimates from multiple species impacted by IM&E should not be treated as strictly additive. After reviewing available stock assessment data, current stock size, and the magnitude of IM&E, EPA determined winter flounder to be the species likely to experience the greatest percent increase in abundance among those species with sufficient stock information to conduct the analysis within the boundaries of the North Atlantic and Mid-Atlantic benefits regions. This species is harvested; however, early life stages of recreational and commercial species may be eaten by other organisms  and therefore have nonuse values.
   3. Estimate total household WTP by applying model results for WTP per percentage of estimated winter flounder impingement mortality and entrainment. Total regional WTP is the product of household WTP and the number of households in the affected region (for details, see Chapter 8 of the BA).
b.	Estimated Nonuse Benefits for the North Atlantic and Mid-Atlantic Regions
      EPA expects that a decrease in impingement mortality and entrainment will lead to increased fish abundance in affected water bodies, thus increasing nonuse benefits. Exhibit X-7 shows the benefits that would result from reducing impingement mortality and entrainment through today's final rule and other options considered. Application of the transfer study requires that the increases be expressed as a percent improvement relative to a maximum number of fish that could be supported. EPA calculated estimates of WTP on the basis of the increase in age-1 equivalent winter flounder relative to the estimated number of age-1 fish when the stock is at maximum sustainable yield, thus assuming that the population structure of the current stock is  similar to the larger stock. The total annualized nonuse benefits for the North Atlantic and Mid-Atlantic regions for the existing unit provision of the final rule are $1 million using a 3 percent discount rate and $0.8 million using a 7 percent discount rate. For other options considered, annualized nonuse benefits range from $0.3 to $51 million using a 3 percent discount rate and $0.3 to $37 million using a 7 percent discount rate.
Exhibit X-7. Annual nonuse benefits from eliminating or reducing IM&E at existing units at existing facilities in the North Atlantic and Mid-Atlantic regions for the final rule and options considered [a]
Regulatory option [b]
                                Winter flounder
                                   IM&E
                                 (million A1E)
                  Increased winter flounder A1E abundance (%)
                               3% discount rate
                               (millions 2011$)
                               7% discount rate
                               (millions 2011$)
Proposal Option 4
                                     0.03
                                     0.02%
                                      0.3
                                      0.3
Final Rule  -  Existing Units
                                     0.08
                                     0.07%
                                      1.0
                                      0.8
Proposal Option 2
                                     4.78
                                     4.18%
                                     51.1
                                     37.3
Baseline
                                     6.23
                                     5.44%
                                     99.1
                                     96.9
[a] IM&E = impingement and entrainment; A1E= age-one equivalent;
[b] IM&E Effects by Option: Proposal Option 4 = impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 50 mgd; Final Rule = impingement mortality standards based on modified traveling screens for all facilities with flow greater than 2 mgd; Proposal Option 2 = intake flow commensurate with closed-cycle cooling for facilities that have a DIF of greater than 125 mgd and impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 2 mgd.

c.	Stated Preference Survey
      EPA conducted a stated preference survey to calculate benefits associated with minimizing adverse impacts to aquatic ecosystems from cooling water intakes. Refer to Sections VI.F.1 and X.D.1 for additional discussion of the stated preference survey. EPA did not rely on the results of its stated preference survey in estimating the benefits of today's rule.
6.	Threatened and Endangered Species
      This section summarizes methods and results of EPA's analysis of benefits from improved protection of T&E species from today's final rule and options considered. Chapter 5 of the BA provides further detail on this analysis.
      Even if levels of mortality due to impingement and entrainment from cooling water intake structures of T&E species are low in absolute numbers, they may represent a substantial portion of annual reproduction because of the reduced population levels that cause a species to be protected. Consequently, impingement mortality and entrainment may either lengthen recovery time, or hasten the demise of these species. Adverse effects of cooling water intake structures on T&E species can occur in several ways:
   * Populations of T&E species may suffer direct harm as a consequence of impingement mortality and entrainment.
   * T&E species may suffer indirect harm if a cooling water intake structure alters food webs.
   * Cooling water intake structures can alter habitat designated as critical to the long-term survival of T&E species.
      Consequently, the 316(b) regulation will help preserve threatened and endangered species.
a.	Qualitative Assessment of Impingement Mortality and Entrainment Impacts on T&E Species
      By definition, T&E species are characterized by low population levels. As such, it is unlikely that these species are recorded in significant number, if recorded at all, in impingement mortality and entrainment monitoring studies. Thus, losses are difficult to identify and quantify in a framework developed for non-listed species. Consequently, EPA developed a qualitative methodology to estimate the number of T&E species affected by impingement mortality and entrainment.
      To qualitatively assess the potential for cooling water intake structure impacts on aquatic T&E species, EPA constructed a database that assessed the geographical overlap of cooling water intake structure and habitat used by aquatic T&E species. This database identified the number of T&E species potentially affected by each regulated 316(b) facility, and the number of facilities potentially affecting each T&E species. Additional details are in Chapter 5 of the BA.
      Using this database, EPA found 99 Federally-listed aquatic T&E species that overlap with at least one covered cooling water intake structure (an interaction in Exhibit X-8). T&E species included freshwater, marine, and anadromous fish, freshwater mussels, and sea turtles. On average, the habitat of each T&E species overlapped with 22 covered facilities (Exhibit X-8), suggesting that the 316(b) rule may have substantial positive benefits of ensuring the long-term sustainability and recovery of T&E species.
Exhibit X-8. Number of regulated 316(b) cooling water intake structures in aquatic T&E species habitat on a per-species basis
Subset of affected species[a b]
                                    Species
                                Interactions[b]
                        Facilities per T&E speciesc

                                      Avg
                                      Max
All T&E Species
99
2,158
21.8
103
T&E Freshwater Mussels
53
1,176
21.8
103
T&E Anadromous Fish
12
235
19.6
101
T&E Freshwater Fish
21
65
3.1
7
T&E Snails
7
199
28.4
49
Sea Turtles
6
483
80.5
102
[a] Aquatic T&E species includes species listed as threatened or endangered by the U.S. Fish and Wildlife Service (freshwater) or National Oceanic and Atmospheric Administration National Marine Fisheries Service (marine). Only aquatic species overlapping with a minimum of one cooling water intake structure are included. [b] Each interaction represents an overlap between the range of a T&E species and cooling water intake structure.
[c] Avg = average, Max = maximum

b.	Quantitative Assessment of Impingement Mortality and Entrainment Impacts on T&E Species
      Although difficult to observe and quantify, EPA identified 14 T&E species with confirmed impingement mortality and entrainment based on facility impingement mortality and entrainment studies. EPA notes that some impingement mortality and entrainment studies identifying T&E losses were conducted prior to the listing of the species under the ESA. In addition to documented species-level instances of T&E mortality, EPA identified impingement mortality and entrainment at the level of genera when these genera contain a T&E species whose habitat range overlapped the reporting facility's cooling water intake structure. Although these are not confirmed impingement mortality and entrainment of T&E species, they provide evidence that additional T&E species are likely to be directly affected by impingement mortality and entrainment. EPA found seven genus-level matches, suggesting that the 14 T&E species suffering impingement mortality and entrainment may be inaccurate.
      Of the 14 Federally-listed T&E species for which EPA was able to document losses in impingement mortality and entrainment studies, EPA was able to quantify impingement mortality and entrainment for two species (pallid sturgeon and Topeka shiner). The documented impingement mortality and entrainment occurred before these species were Federally-listed. Data were either qualitative or of insufficient quality to quantify local or regional impingement mortality and entrainment for the remaining 12 Federally-listed T&E species. EPA also quantified impingement mortality and entrainment for the American paddlefish (Polyodon spathula), listed by several states as threatened or endangered under State law, using facility impingement mortality and entrainment studies. Exhibit X-9 presents EPA's estimates of baseline annual impingement mortality and entrainment, and reductions in impingement mortality and entrainment which EPA estimates will occur under the final rule and other options considered.
Exhibit X-9. Baseline annual IM&E for T&E species and reductions for existing units at existing facilities (A1Es) [a,b]
Species
Proposal Option 4
Final Rule  -  Existing Units
Proposal Option 2
                                   Baseline
Paddlefish [c]

                                                                        7,930.1
                                                                        8,245.4
                                                                       15,659.7
                                                                       18,841.4
Pallid Sturgeon

                                                                           65.4
                                                                           67.6
                                                                           78.0
                                                                           89.5
Topeka Shiner

                                                                        2,910.9
                                                                        3,009.8
                                                                        3,471.9
                                                                        3,984.9
Total

                                                                       10,906.4
                                                                       11,322.8
                                                                       19,209.5
                                                                       22,915.7
[a] IM&E = impingement and entrainment; A1E= age-one equivalent;
[b] IM&E Effects by Option: Proposal Option 2 = impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 50 mgd; Final Rule = impingement mortality standards based on modified traveling screens for all facilities with flow greater than 2 mgd; Proposal Option 2 = intake flow commensurate with closed-cycle cooling for facilities that have a DIF of greater than 125 mgd and impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 2 mgd.
[c] The American paddlefish is not a Federally-listed T&E species but is listed as threatened or endangered on several state lists.
[d] This analysis is based solely on IM controls.

      Impingement mortality and entrainment is only one of many factors that adversely affect T&E species. Estimating total population impacts from changes in impingement mortality and entrainment requires estimates of current populations of these fish and estimates of other anthropogenic effects which were not readily available for all T&E species with quantified impingement mortality and entrainment at the time of this analysis. Therefore, EPA was unable to quantify effects on T&E populations from the 316(b) regulation.
c.	Valuation Methods of T&E Fish Species
      EPA had sufficient data from impingement mortality and entrainment studies to quantify impingement mortality and entrainment estimates for three T&E species, Topeka shiner, pallid sturgeon, and paddlefish (Exhibit X-9). Two of these species (pallid sturgeon and paddlefish) have potential use values. A limited recreational fishery (mostly catch and release) exists for paddlefish in several states; although harvesting pallid sturgeon is illegal, the species is sometimes caught by recreational anglers. EPA estimated recreational use values for pallid sturgeon and paddlefish by applying transfer values from a Random Utility Model analysis it conducted to evaluate recreational fishing benefits of the 316(b) Phase II regulation to quantified impingement mortality and entrainment (for details, see Chapter 5 of the BA).
      EPA was unable to generate estimates of nonuse values for T&E fish species because reliable population estimates needed to transfer the values were unavailable. However, EPA emphasizes that nonuse values for T&E fish species are likely to be significantly greater than any use values. Harvest of these species is prohibited, reflecting a societal judgment that protection and preservation of these species is of greater value than harvest.
d.	Estimated Monetary Benefits from Reduced Mortality of T&E Fish Species
	Exhibit X-10 presents the estimated annualized benefits for a subset of T&E species. For existing units under the final rule, EPA estimates total annualized use benefits for T&E species with quantified impingement mortality and entrainment of $0.4 million using a 3 percent discount rate and $0.3 million using a 7 percent discount rate. For other options considered, annualized benefits range from $0.4 to $0.7 million using a 3 percent discount rate and $0.3 to $0.5 million using a 7 percent discount rate.
Exhibit X-10. Annual use benefits from eliminating or reducing IM&E of T&E species at existing units of existing facilities for the final rule and other options considered[a][,b][,c]
Regulatory option
                               Increased harvest
                               3% discount rate
                               7% discount rate

                               (number of fish)
                                (million 2011$)
                                (million 2011$)
Proposal Option 4
                                                                        7,995.5
                                                                            0.4
                                                                            0.3
Final Rule  -  Existing Units
                                                                        8,313.0
                                                                            0.4
                                                                            0.3
Proposal Option 2
                                                                       15,737.7
                                                                            0.7
                                                                            0.5
Baseline
                                                                       18,930.9
                                                                            1.2
                                                                            1.3
[a] IM&E = impingement and entrainment; T&E = threatened and endangered
Values are included for pallid sturgeon and paddlefish in the Inland region.
[b] IM&E Effects by Option: Proposal Option 4 = impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 50 mgd; Final Rule = impingement mortality standards based on modified traveling screens for all facilities with flow greater than 2 mgd; Proposal Option 2 = intake flow commensurate with closed-cycle cooling for facilities that have a DIF of greater than 125 mgd and impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 2 mgd.
[c] This analysis is based solely on impingement mortality controls.

      EPA notes that the benefit values presented in Exhibit X-10 represent only a fraction of values for T&E species potentially affected by the final existing facilities rule. The Agency was able to obtain only use values and for only a small subset of all affected T&E species. Moreover, because of the nature of T&E species, even a small increase in population could yield economic and ecological benefits (e.g., Richardson and Loomis; Bell et al.; Berrens et al.)
e.	Valuation Methods for T&E Sea Turtles
      In addition to estimating values of T&E fish with quantitative estimates of impingement mortality and entrainment, EPA estimated the WTP for sea turtle conservation. In this analysis, EPA applied estimates from a study using a stated preference valuation approach to estimate total economic value of a management program that reduces the risk of extinction of loggerhead sea turtles.
      Although impingement mortality and entrainment of turtles is relatively low compared to mortality from shrimp trawling and other fisheries, it is known that reducing turtle mortality during juvenile and subadult life stages can have a substantial positive effect on population growth. The marginal change in extinction probability of sea turtles due to 316(b) regulatory options is likely to be at least 0.01, or a 1 percent decrease in the probability of extinction over 25 years. This assessment is based on reports that impingement mortality and entrainment may result in the loss of more than 100 turtles per year and because turtle population growth rates are known to be sensitive to changes in juvenile and subadult life stages.
f.	Benefits from Reduced Mortality of T&E Sea Turtles
The U.S. range of loggerhead sea turtles includes the Gulf of Mexico, South Atlantic, Mid-Atlantic, and North Atlantic 316(b) regions. To calculate national WTP for an increased 25-year survival probability of loggerhead sea turtles, EPA assumed the affected population to include households in States with 316(b) facilities that are in loggerhead sea turtle habitat. EPA determined that 54.8 million households would be willing to pay for improved protection of loggerhead sea turtles. Although incidences of mortality have been reported at facilities in California, Texas, Florida, South Carolina, North Carolina, and New Jersey, EPA does not have sufficient information to quantify total sea turtle losses due to intakes or the reductions in such losses that might occur from the final rule or options considered. But as an illustrative example, assuming that the survival probability of loggerhead sea turtles over 25 years were increased by 1 percent, and applying a mean household value of $0.37 (2011 dollars), the monetized value would be $19.3 million and $18.8 million using discount rates of 3 percent and 7 percent, respectively.  EPA is presenting these estimates only to demonstrate the potential range of benefits, and is not including them in national benefits totals for the final rule and options considered. Actual household values and total benefits may be higher or lower than these estimates, with Proposal Option 2 likely to provide substantially greater benefits than the final rule and Proposal Option 4.
      Because EPA does not currently have accurate national estimates of impingement mortality and entrainment for turtle species, nor are population models available that estimate the effect of 316(b) regulation on population size and extinction risk, these estimates are presented only as an illustrative example and are not included in national totals.
g.	Other Indications of Society's WTP for Protection of T&E Species
      Many sources provide information that indicates that society places significant value on protecting T&E species. These include, but are not limited to:
   * The Endangered Species Act of 1973, which provides for the conservation of T&E species of fish and wildlife. Federal and State expenditures on T&E species were $593 million during fiscal year 2011 just on protection of those Federally-listed T&E species that have habitat overlapping cooling water intake structures. This accounted for 68 percent of the $869 million spent on fish, marine reptiles, crustaceans, corals, clams, aquatic snails and marine mammals listed under the Endangered Species Act.
   * Restrictions on activities in the habitat occupied by T&E species. For example, water diversions on the San Joaquin-Sacramento River delta, in place to protect the Delta Smelt (Hypomesus transpacificus), limit the extraction of water for drinking and agriculture.
   * The willingness of individuals to volunteer their time to conserve T&E species. For example, dozens of organizations recruit thousands of volunteers every year to participate in sea turtle conservation and research projects. Volunteers are often required to undergo substantial training and commit to long hours.
      While costs to replace, protect, or enhance stocks, and costs to users affected by efforts to conserve stocks are not direct measures of economic benefits, they indicate that society is willing to pay significant sums to protect and restore populations of T&E species. Although impingement mortality and entrainment is only one of many stressors on these species, reducing the amount of impingement mortality and entrainment could contribute to the recovery of populations over time, thereby eliminating some costs associated with conserving T&E species.
7.	Assessment of Thermal Discharge Impacts
      In addition to reducing total impingement mortality and entrainment, closed-cycle cooling reduces thermal pollution. Most retrofit installations of cooling towers at electric generating facilities have been required by NPDES permits to reduce thermal discharges. Since thermal discharges are a product of cooling water intake structures, the impacts of thermal discharges are a relevant benefit to consider when assessing appropriate technologies to reduce the effects of cooling water intakes. The installation of technologies, such as closed-cycle cooling systems, can reduce thermal pollution significantly. Thermal pollution has long been recognized to cause harm to the structure and function of aquatic ecosystems. Concerns about the impacts of thermal discharges are addressed by State water quality standards that, when implemented through NPDES permits, limit the amount of heat that can be discharged to a receiving water and result, in some cases, in technology-based permit conditions. Section 316(a) of the CWA applies to point sources with thermal discharges. It authorizes the NPDES permitting authority to impose alternative effluent limitations for the control of the thermal component of a discharge in lieu of the effluent limitations that would otherwise be required under sections 301 or 306 of the CWA. Before such a "thermal variance" can be granted, the permittee must demonstrate that the alternative limit will assure the protection and propagation of a balanced, indigenous population of shellfish, fish and wildlife in and on the body of water into which the discharge is to be made. 40 CFR 125.73(a).
      EPA did not quantify nationally the impacts of thermal discharges. However, numerous studies have shown that thermal discharges may substantially alter the structure of aquatic communities by modifying photosynthetic, metabolic, and growth rates. Thermal discharges also harm aquatic life by reducing levels of dissolved oxygen, altering the location and timing of fish behavior such as spawning, aggregation, and migration, and may cause thermal shock-induced mortality for some species. Adverse temperature effects may also be more pronounced in aquatic ecosystems that are already subject to other environmental stressors such as high levels of biochemical oxygen demand, nutrient and sediment contamination, or pathogens. Within mixing zones, which often extend several miles downstream from outfalls, thermal discharges may impair efforts to restore and protect the waterbody. For example, permit requirements to limit nitrogen discharges in a watershed, and thereby reduce harmful algal blooms, may be counteracted by thermal discharges which promote growth of harmful algae. Thermal discharges may have indirect effects on fish and other vertebrate populations through increasing pathogen growth and infection rates.
      Thermal discharges may thus alter the ecological services, and reduce the benefits, of aquatic ecosystems that receive heated effluent. The magnitude of thermal effects on ecosystem services is related to facility-specific factors, including the volume of the waterbody from which cooling water is withdrawn and returned, other heat loads, the rate of water exchange, the presence of nearby refugia, and the assemblage of nearby fish species.

8.	Assessment of Social Cost of Carbon
      The social cost of carbon reflects the estimated increase in the burden of global warming to society in future years due to higher greenhouse gas (GHG) emissions, measured as CO2 equivalents, associated with additional energy requirements  -  energy penalty, auxiliary energy requirements, and compliance technology installation  -  of regulatory options. EPA estimated positive or negative benefits associated with the social cost of carbon for decreases or increases, respectively for Proposal Option 4 and Final Rule or Proposal Option 2, in energy requirements at regulated facilities under the final rule and other options considered.
      EPA's estimates of changes in CO2 emissions were based on results from the electricity market analysis using IPM. For electric generators, EPA estimated the change in CO2 resulting from the energy penalty associated with close-cycle recirculating technology, auxiliary energy requirement for operating compliance technology, and technology installation downtime. For manufacturers, EPA estimated the change in carbon emissions resulting from the energy penalty and auxiliary energy requirement. For compliance technology installation downtime at manufacturers, EPA assumed no change in carbon emissions as the short-term replacement of energy by electric power generating facilities that would otherwise be produced at manufacturers could either increase or decrease emissions.
      To estimate benefits associated with the reductions in carbon emissions, EPA used social cost of carbon values calculated from the 2013 document titled, Technical Support Document: Technical Update of the Social Cost of Carbon for Regulatory Impact Analysis Under Executive Order 12866, developed by the U.S. Government Interagency Working Group on Social Cost of Carbon. The Agency used the Working+ Group's annual social cost of carbon values for 2010 through 2050 based on the 3 percent average discount rate, which EPA has concluded is the most appropriate discount rate for intergenerational benefits such as the social cost of carbon. See Chapter 9 of the BA for annual social cost of carbon values based on discount rates of 2.5, 3 (high) and 5 percent. Benefits for each year of the analysis period were calculated by multiplying the change CO2 emissions by the SCC value for that year. Similar to the treatment of other benefits, EPA discounted all year-specific social cost of carbon values to the beginning of 2013 and calculated an annualized value over 51 years using a 3-percent discount rate. EPA acknowledges that it is mixing estimates of benefits categories analyzed at different discount rates, but finds in this case that using different discount rates is justified by the intergenerational nature of the social cost of carbon, for purposes of the sensitivity analysis based on a 7 percent discount rate to discount other benefit categories.
      Exhibit X-11 presents annualized benefits for existing units for the final rule and options considered. Included in the monetized benefits is EPA's estimate that the final rule will reduce greenhouse gas emissions by 9.3 million tons of CO2-equivalent emissions over the 40-year compliance period for this analysis. Both the final rule and Proposal Option 4 result in a net reduction in CO2 emissions for existing units during the analysis period. Proposal Option 2 would result in a net increase in emissions and negative benefits for existing units. Using a 3 percent discount rate, annualized benefits under the final rule for existing units are $12 million. Using a 7 percent discount rate, annualized benefits under final rule for existing units are $13 million.
Exhibit X-11. Benefits Associated with Social Cost of Carbon for Existing Units for the Final Rule and Other Options Considered (in millions of 2011 dollars)[a]
Regulatory Option[b]
                               3 % Discount Rate
                               7 % Discount Rate
Proposal Option 4
                                                                           12.4
                                                                           13.4
Final Rule  -  Existing Units
                                                                           12.4
                                                                           13.4
Proposal Option 2
                                                                       -1,643.1
                                                                       -1,218.2
[a] Benefits are based on the workgroup's average social cost of carbon values using 3 percent rate.

9.	Benefits for New Units
      In addition to the final rule and other options considered for existing units, EPA analyzed the benefits of the requirements for new units at existing facilities. EPA could not directly apply the benefits methodology used for IM&E (impingement mortality and entrainment) reductions at existing units to new units because it lacks facility-specific information to estimate regional impingement mortality and entrainment reductions for new units. Instead, EPA estimated benefits associated with IM&E reductions for the new unit requirements on the basis of the monetary benefits per million gallons per day from the analysis of existing units. EPA also estimated benefits associated with changes in GHG emissions as the result of the energy penalty associated with operating cooling towers using the social cost of carbon. Exhibit X-12 below presents the estimates of monetized benefits for the new unit requirements. MonetizedTotal benefits are -$0.2 million discounted at 3 percent and -$0.1 million discounted at 7 percent.
Exhibit X-12. National benefits under the final rule for new units at existing facilities (in 2011 dollars)
Regulatory option [a]

                         Monetized benefit categories

                             Recreational fishing
                              Commercial fishing
                                    Nonuse
                              T&E species[b]
                           Social Cost of Carbon[c]
                                     Total
                       3% discount rate (millions 2011$)
Final Rule - New Units
                                      0.0
                                      0.0
                                      0.1
                                      0.0
                                     -0.3
                                     -0.2
                       7% discount rate (millions 2011$)
Final Rule - New Units
                                      0.0
                                      0.0
                                      0.0
                                      0.0
                                     -0.2
                                     -0.1
[a] IM&E Effects: Final Rule  -  New Units - entrainment requirements for all stand-alone facilities
b Benefits estimates for T&E species are restricted to recreational fishing benefits from increased catch of T&E species. They do not include benefits for reduced mortality of T&E sea turtles and other nonuse values associated with T&E species.
[c] Benefits are based on the Work Group's average social cost of carbon values using the 3 percent rate.

10.	National Monetized Benefits
      Quantifying and monetizing reductions in impingement mortality and entrainment attributable to the final rule and other options considered is challenging. National benefit estimates are subject to uncertainties inherent in valuation approaches used to assess the benefits categories (see Chapters 5, 6, 7, 8, 9, and 12 of the BA). While EPA has no data to indicate that the results for each benefit category are atypical or unreasonable, some potentially significant benefit categories have not been fully monetized, and thus the national monetized benefits presented below likely underestimate total benefits.
      Exhibit X-13 presents EPA's estimates of the partial monetized benefits from impingement mortality and entrainment reduction and the social cost of carbon for the final rule and other options considered. These monetized values represent use values from increased commercial and recreational catch, benefits transfer of recreational fishing benefits of threatened and endangered species, nonuse values associated with an increase in fish abundance (those fish that are not caught) in the Northeast and Mid-Atlantic benefit regions, and national benefits estimates associated with the social cost of carbon. For the final rule for existing and new units, partial estimated benefits from reducing impingement mortality and entrainment at existing units are $33 million using a 3 percent discount rate and $29 million using a 7 percent discount rate. EPA was not able to fully monetize the benefits for the final rule. Thus, the estimates represent a conservative (i.e., low) estimate of total regulatory benefits of the final rule.
Exhibit X-13. Summary of national benefits for all regulated facilities for the final rule
Regulatory option [a]
                         Monetized benefit categories

                             Recreational fishing
                              Commercial fishing
                                    Nonuse
                              T&E Species[b]
                           Social Cost of Carbon[c]
                                     Total
                       3% discount rate (millions 2011$)
Final Rule  -  Existing Units
                                     18.2
                                      0.9
                                      1.0
                                      0.4
                                     12.4
                                     33.0
Final Rule  -  New Units
                                      0.0
                                      0.0
                                      0.1
                                      0.0
                                     -0.3
                                     -0.2
Final Rule (Existing Units + New Units)
                                     18.3
                                      0.9
                                      1.1
                                      0.4
                                     12.1
                                     32.8
                       7% discount rate (millions 2011$)
Final Rule  -  Existing Units
                                     13.5
                                      0.7
                                      0.8
                                      0.3
                                     13.4
                                     28.7
Final Rule  -  New Units
                                      0.0
                                      0.0
                                      0.1
                                      0.0
                                     -0.2
                                     -0.1
Final Rule (Existing Units + New Units)
                                     13.5
                                      0.7
                                      0.9
                                      0.3
                                     13.2
                                     28.6
[a] IM&E Effects: Final Rule - Existing Units = impingement mortality standards based on modified traveling screens for all facilities with flow greater than 2 mgd; Final Rule - New Units: entrainment requirements for all stand-alone facilities where the turbine and condenser are newly built or replaced.
b Benefits estimates for T&E species are restricted to benefit transfer of recreational fishing benefits from T&E species. They do not include benefits for reduced mortality of T&E sea turtles and other nonuse values associated with T&E species.
[c] Baseline does not include potential benefits associated with the social cost of carbon.

      Exhibit X-14 presents total monetized benefits for the final rule and other options EPA considered for existing units by benefit category using a 3 percent discount rate. Annual monetized benefits are slightly higher for the final rule than Proposal Option 4, and are negative for Proposal Option 2.  Including both existing and new units, annual monetized benefits are $32.8 million for the final rule, $30.8 million for Proposal Option 4 and -$1,542.8 million for Proposal Option 2.

Exhibit X-14. Summary of national benefits for all regulated facilities for the final rule and other
 options EPA considered (3% discount rate)
Monetized Benefit Categories
                   Annual Benefits by Regulatory Option[a]
                               (millions 2011$)

                               Proposal Option 4
                         Final Rule  -  Existing Units
                               Proposal Option 2
                                Existing Units
Recreational Fishing
                                     17.1
                                     18.2
                                     43.0
Commercial Fishing
                                      0.9
                                      0.9
                                      3.9
Nonuse
                                      0.3
                                      1.0
                                     51.1
T&E Species[b]
                                      0.4
                                      0.4
                                      0.7
Social Cost of Carbon
                                     12.4
                                     12.4
                                   -1,641.3
Total
                                     31.0
                                     33.0
                                   -1,542.6
                            Final Rule - New Units
Total
                                     -0.2
                                     -0.2
                                     -0.2
                            Existing and New Units
Total
                                     30.8
                                     32.8
                                   -1,542.8
[a] IM&E Effects: Proposal Option 4 = impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 50 mgd; Final Rule - Existing Units = impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 2 mgd; Proposal Option 2 =  impingement mortality limitations based on modified traveling screens for all facilities with flow greater than 2 mgd and entrainment mortality limitations commensurate with closed-cycle recirculating systems for all facilities with flow greater than 125 DIF; Final Rule - New Units: entrainment requirements for all stand-alone facilities.
b Benefits estimates for T&E species are restricted to benefit transfer of recreational fishing benefits from T&E species. They do not include benefits for reduced mortality of T&E sea turtles and other nonuse values associated with T&E species.

EPA recognizes that its estimates of ecological and economic benefits projected to occur under regulation are affected by uncertainty at many levels.
   * Not all ecological goods and services affected by cooling water intake structures at regulated 316(b) facilities are modeled or monetized, suggesting that the total benefits of regulation may be underestimated. For example, potential increases in ecosystem stability that might occur as a result of regulation is not explicitly estimated nor monetized.
   * When particular ecological goods and services are monetized, data is not always available at the national level. For example, EPA was only able to estimate the nonuse benefits transfer for a species that represents less than one percent of adverse environmental impacts.
   * For the proposed rule, EPA used a habitat-based method to assess potential WTP for reducing fish mortality at CWIS based on the approximate area of habitat required to produce and support the number of organisms lost to impingement mortality and entrainment. EPA did not consider the habitat-based approach appropriate for primary analysis of benefits for the proposed rule, and did not include it in its analysis for the final rule. However, the results for the proposed rule illustrate that total benefits may be substantially greater than benefits estimated using the methodologies described in Section D.
      Because EPA was able to only partially monetize nonuse benefits using the benefits transfer approach, EPA expects that the actual benefits will be greater than those presented here.

XI.	Related Acts of Congress, Executive Orders, and Agency Initiatives
A.	Executive Order 12866: Regulatory Planning and Review and Executive Order 13563: Improving Regulation and Regulatory Review
      Under section 3(f)(1) of E.O. 12866 (58 FR 51735, October 4, 1993), this action is an economically significant regulatory action because it is likely to have an annual effect of $100 million or more on the economy. Accordingly, EPA submitted this action to the Office of Management and Budget for review under E.O. 12866 and 13563 (76 FR 3821, January 21, 2011), and any changes made in response to Office of Management and Budget recommendations have been documented in the docket for this action.
      In addition, EPA prepared an analysis of the costs and benefits associated with this action; this analysis is discussed in detail in the Chapter 8 of the EA. A copy of the EA is available in the docket for this action, and the analysis is briefly summarized here.
      Exhibit XI-1 (drawn from Chapter 8 of the EA) provides the results of the benefit-cost analysis. Placeholders for option-specific non-monetized benefits are represented by BP4 for Proposal Option 4, BFR for the final rule and BP2 for Proposal Option 2. While preliminary, and not yet reviewed by EPA's Science Advisory Board, the preliminary results of EPA's stated preference survey (see BA, Chapter 11) suggest that BP4, BFR, and BP2 have the potential to be significantly different from zero. EPA is therefore using placeholders for additional benefits that are not captured by its analysis of use benefits and the benefits transfer for nonuse benefits. However, EPA did not rely on the results of its stated preference survey in estimating the benefits of today's rule.  EPA has concluded that the benefits of the rule justify the costs.
      EPA also analyzed the employment effects of the final rule and other options considered in development of this rule. The results of that analysis are summarized in Section IX.E of this preamble and Chapter 9 of the EA.
Exhibit XI-1. Annualized benefits and costs of the regulatory options (in millions, 2011 dollars)[a]
                                    Option
                             Total social costs[b]
                                  Benefits[c]
Proposal Option 4
                                                                         $251.8
                                                                    $31.0 + BP4
 Final Rule
                                                                         $274.9
                                                                    $32.8 + BFR
 Proposal Option 2
                                                                       $3,643.2
                                                                 -$1,542.6+ BP2
 a Social costs and benefits were annualized over 51 years and discounted using 3 percent rate.
[b] Total social costs include compliance costs to facilities and government administrative costs. See EA Chapter 7.
[C] Benefits include social cost of carbon from changes in greenhouse gas emissions due to the final rule.

B.	Paperwork Reduction Act
      The information collection requirements in this rule will be submitted for approval to the Office of Management and Budget (OMB) under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. The supporting statement in EPA's information collection request estimates the burden to permitted facilities; burden is defined at 5 CFR 1320.3(b).  The 60-day comment period will commence after publication of the draft ICR. The information collection requirements are not enforceable until they are approved by OMB.
      Today's rule requires several distinct types of information collection as part of the NPDES permit application. In general, the information will be used to assist EPA in regulating environmental impacts, namely impingement mortality and entrainment, at cooling water intake structures and to identify how a cooling water intake structure at an  existing facility or a new unit at an existing facility will meet the impingement mortality and entrainment requirements. Today's rule also requires other reporting and recordkeeping requirements to demonstrate and document compliance with the requirements. Compliance with the applicable information collection requirements established under this final rule is mandatory (see §§ 122.21(r), 125.136, 125.137, 125, and 138).
      EPA does not consider the specific data that will be collected under this final rule to be confidential business information. However, if a respondent does consider this information to be confidential, the respondent may request that such information be treated as confidential. All confidential data submitted to EPA will be handled in accordance with 40 CFR 122.7, 40 CFR part 2, and EPA's Security Manual Part III, Chapter 9, dated August 9, 1976.
      This final rule modifies regulations at § 122.21 to require each existing facility and new unit at an existing facility to prepare and submit information as part of the facility's NPDES permit application. A detailed list of required data items is provided below.
      EPA estimates an average annual burden of 634,596 hours for the final rule's information collection requirements. Of this total, EPA estimates that 1,068 regulated facilities will incur an annual average burden of 588 hours per respondent (for a total of 627,666 burden hours). EPA estimates that Directors in 46 States and one territory with NPDES permitting authority, will incur an annual average burden for the review, oversight, and administration of the rule, of 6,930 hours, or an annual average of 147 hours per permitting authority. Slight differences in calculations are due to rounding.
      The corresponding estimate of costs other than labor (labor and non-labor costs are included in the total cost of the final rule discussed in Section IX of this preamble) during the first three years after promulgation of the rule is an annual average of $8.5 million. Non-labor costs include activities such as capital costs for sampling equipment, remote monitoring devices, laboratory services, photocopying, and the purchase of supplies. The burden and costs are for the information collection, reporting, and recordkeeping requirements for the three-year period beginning with the assumed effective date of this rule. Additional information collection requirements will occur after this initial three-year period as (1) existing facilities will continue to gather and submit required permit application materials and (2) new units at existing facilities commence operations and are issued permits.
      Information and studies to be submitted under this final rule (as required by §§ 122.21(r) and 125.95) by existing facilities and new units at existing facilities are listed below. For more information, see Section VIII in the preamble.
   * Source Water Physical Data (§ 122.21(r)(2))
   * Cooling Water Intake Structure Data (§ 122.21(r)(3))
   * Source Water Baseline Biological Characterization Data (§ 122.21(r)(4))
   * Cooling Water System Data (§ 122.21(r)(5))
   * Chosen Method of Compliance with Impingement Mortality Standards (§ 122.21(r)(6))
   * Performance Studies (§ 122.21(r)(7))
   * Operational Status (§ 122.21(r)(8))
   * Entrainment Characterization Study (§ 122.21(r)(9))
   * Comprehensive Technical Feasibility and Cost Evaluation Study (§ 122.21(r)(10))
   * Benefits Valuation Study (§ 122.21(r)(11))
   * Non-Water Quality and Other Environmental Impacts Study (§ 122.21(r)(12))
      In addition to the information requirements of the permit application, NPDES permits normally specify monitoring and reporting requirements to be met by the permitted entity. Existing facilities and new units at existing facilities are required to perform monitoring as determined by the requirements in § 125.94 and in accordance with §§ 125.96 and 125.97.
      Finally, in accordance with § 125.95(e), facilities are required to maintain records of all submissions that are part of its permit application for a minimum of five years. If the Director approves a request for reduced permit application studies under § 125.95(a) or § 125.98(g), the facility must keep records of all submissions that are part of a previous permit application for an additional five years. Also, facilities must keep record of all submissions that are part of the permit reporting requirements for a periods of at least five years from the date of permit issuance, in accordance with § 125.97(d).

      An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.
C.	Regulatory Flexibility Act (RFA)
      The Regulatory Flexibility Act generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedure Act or any other statute unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small organizations, and small governmental jurisdictions.
1.	Definition of Small Entities and Estimation of the Number of Small Entities Subject to Today's Final Regulation
      For EPA's assessment of the impact of today's final rule on small entities, small entity is defined as either a (1) a small business as defined by SBA (Small Business Administration) regulations at 13 CFR 121.201; (2) a small governmental jurisdiction that is a government of a city, county, town, school district, or special district with a population of fewer than 50,000; or (3) a small organization that is any not-for-profit enterprise that is independently owned and operated and is not dominant in its field. Federal or State entities owning regulated facilities are not small entities.
      EPA performed this assessment separately for the two classes of facilities and their owner entities -- electric generators and manufacturers -- that are subject to today's rule.
a.	Electric Generators
      EPA followed the SBA criteria for identifying small, non-government entities in the electric power industry, as follows:
   *       For non-government entities with electric power generation as a primary business, small entities were designated using employment size thresholds specific to each 6-digit NAICS code.
   *       For government entities other than Federal or State governments, small entities are those with a population of fewer than 50,000.
   *       For entities with a primary business other than electric power generation, the relevant size criteria are based on revenue or number of employees by NAICS sector (see Exhibit XI-2).
Exhibit XI-2. NAICS codes and SBA entity size standards for entities that own electric generators with a primary business other than electric power generation
NAICS code
NAICS description
SBA size standard
212111
Bituminous Coal and Lignite Surface Mining
500 employees
221210
Natural Gas Distribution
500 employees
331110
Iron and Steel Mills and Ferroalloy Manufacturing
1,000 employees
331315
Aluminum Sheet, Plate, and Foil Manufacturing
750 employees
333611
Turbine and Turbine Generator Set Units Manufacturing
1,000 employees
488320
Marine Cargo Handling
$35.5 million in revenue
491110
Postal Service
$7 million in revenue
522110
Commercial Banking
$175 million in assets
523910
Miscellaneous Intermediation
$7 million in revenue
524126
Direct Property and Casualty Insurance Carriers
1,500 employees
525910
Open-End Investment Funds
$7 million in revenue
525990
Other Financial Vehicles
$7 million in revenue
541990
All Other Professional, Scientific, and Technical Services
$14 million in revenue
551112
Offices of Other Holding Companies
$7 million in revenue
562212
Solid Waste Landfill
$35.5 million in revenue
562219
Other Nonhazardous Waste Treatment and Disposal
$35.5 million in revenue
562920
Materials Recovery Facilities
$19 million in revenue
611310
Colleges, Universities, and Professional Schools
$25.5 million in revenue

      EPA conducted this analysis for the same set of parent entities it analyzed in the general entity-level cost-to-revenue analysis discussed in Section IX.D. To determine whether these are small entities on the basis of the size criteria outlined above, EPA compared the relevant measure for the identified parent entities to the appropriate SBA size criterion. EPA conducted this analysis using (1) facility-level weights without using entity-level weights, and (2) entity-level weights without using facility-level weights (for information on these two weighting approaches, see Appendix H of the EA).
      EPA estimates that between 31 and 52 small entities own electric generators that are subject to the rule. They represent approximately 25 to 32 percent of entities that own electric generators (see Exhibit XI-3).
Exhibit XI-3. Number of entities that own electric generators, by ownership type
Ownership type[a]
Using facility-level weights
Using entity-level weights[b]

Total
Small
% Small
Total
Small
% Small
Cooperative
                                                                             13
                                                                             11
                                                                          84.6%
                                                                             21
                                                                             18
                                                                          85.7%
Federal
                                                                              1
                                                                              0
                                                                           0.0%
                                                                              1
                                                                              0
                                                                           0.0%
Investor-owned
                                                                             57
                                                                              6
                                                                          10.5%
                                                                             60
                                                                              7
                                                                          11.7%
Municipality
                                                                             19
                                                                              7
                                                                          36.8%
                                                                             38
                                                                             19
                                                                          50.0%
Nonutility
                                                                             26
                                                                              7
                                                                          26.9%
                                                                             30
                                                                              8
                                                                          26.7%
Other Political Subdivision
                                                                              4
                                                                              0
                                                                           0.0%
                                                                              6
                                                                              0
                                                                           0.0%
State
                                                                              3
                                                                              0
                                                                           0.0%
                                                                              3
                                                                              0
                                                                           0.0%
All Entity Types
                                                                            123
                                                                             31
                                                                          25.2%
                                                                            159
                                                                             52
                                                                          32.7%
 a State and Federal entities are considered large.
 b In addition to the 52 small parent entities on an unweighted basis, one additional entity is an "other political subdivision entity" for a total of 53. This entity owns only implicitly analyzed facilities; consequently, there is no explicitly analyzed entity in the other political subdivision ownership category to represent this implicitly analyzed small parent entity. As the result, weighted entity counts do not include one small other political subdivision entity.

b.	Manufacturers
      EPA also used the SBA criteria for identifying small, non-government entities in the manufacturing sector. Exhibit XI-4 lists the SBA size threshold guidelines for entities that own manufacturers.
      Exhibit XI-4. NAICS codes and SBA entity size standards for entities that own manufacturers
NAICS code
NAICS description
SBA size standard
111930
Sugarcane Farming
$0.75 million in revenue
113110
Timber Tract Operations
$7 million in revenue
211111
Crude Petroleum and Natural Gas Extraction
500 employees
212210
Iron Ore Mining
500 employees
212391
Potash, Soda, and Borate Mineral Mining
500 employees
221122
Electric Power Distribution
4,000,000 MWh of electric generation
311221
Wet Corn Milling
750 employees
311314
Cane Sugar Manufacturing
750 employees
311313
Beet Sugar Manufacturing
750 employees
311942
Spice and Extract Manufacturing
500 employees
313210
Broadwoven Fabric Mills
1,000 employees
321113
Sawmills
500 employees
322121
Paper (except Newsprint) Mills
750 employees
322122
Newsprint Mills
750 employees
322130
Paperboard Mills
750 employees
322211
Corrugated and Solid Fiber Box Manufacturing
500 employees
322220
Paper Bag and Coated and Treated Paper Manufacturing
500 employees
322291
Sanitary Paper Product Manufacturing
500 employees
324110
Petroleum Refineries
1,500 employees
324191
Petroleum Lubricating Oil and Grease Manufacturing
500 employees
325120
Industrial Gas Manufacturing
1,000 employees
325180
Other Basic Inorganic Chemical Manufacturing
1,000 employees
325199
All Other Basic Organic Chemical Manufacturing
1,000 employees
325211
Plastics Material and Resin Manufacturing
750 employees
325311
Nitrogenous Fertilizer Manufacturing
1,000 employees
325320
Pesticide and Other Agricultural Chemical Manufacturing
500 employees
325412
Pharmaceutical Preparation Manufacturing
750 employees
325510
Paint and Coating Manufacturing
500 employees
325992
Photographic Film, Paper, Plate and Chemical Manufacturing
500 employees
325998
All Other Miscellaneous Chemical Product and Preparation Manufacturing
500 employees
331110
Iron and Steel Mills and Ferroalloy Manufacturing
1,000 employees
331210
Iron and Steel Pipe and Tube Manufacturing from Purchased Steel
1,000 employees
331221
Rolled Steel Shape Manufacturing
1,000 employees
331222
Steel Wire Drawing
1,000 employees
331313
Alumina Refining and Primary Aluminum Production
1,000 employees
331315
Aluminum Sheet, Plate and Foil Manufacturing
750 employees
331410
Nonferrous Metal (except Aluminum) Smelting and Refining
1,000 employees
332312
Fabricated Structural Metal Manufacturing
500 employees
337910
Mattress Manufacturing
500 employees
339999
All Other Miscellaneous Manufacturing
500 employees
423310
Lumber, Plywood, Millwork, and Wood Panel Merchant Wholesalers
100 employees
423930
Recyclable Material Merchant Wholesalers
100 employees
424510
Grain and Field Bean Merchant Wholesalers
100 employees
424690
Other Chemical and Allied Products Merchant Wholesalers
100 employees
424710
Petroleum Bulk Stations and Terminals
100 employees
447190
Other Gasoline Stations
$14 million in revenue
522220
Sales Financing
$7 million in revenue
523910
Miscellaneous Intermediation
$7 million in revenue
523930
Investment Advice
$7 million in revenue
524126
Direct Property and Casualty Insurance Carriers
1,500 employees
525990
Other Financial Vehicles
$7 million in revenue
531110
Lessors of Residential Buildings and Dwellings
$25 million in revenue
551112
Offices of Other Holding Companies
$7 million in revenue
561110
Office Administrative Services
$7 million in revenue

      Similar to the analysis conducted for electric generators, EPA conducted this analysis for the same set of parent entities as analyzed in the general, entity-level, cost-to-revenue analysis discussed in Section IX.D. To determine which entities are small, EPA compared the relevant measure for the identified parent entities to the appropriate SBA size criterion. EPA used two sample-weighting schemes in this analysis; these provide a range of counts of small entities that own regulated facilities and the number of regulated facilities that they own that will incur costs under the final rule. EPA does not find either of these sample-weighting schemes to be superior to the other in the quality of the resulting estimates of small entity counts and occurrence of impacts. The different weighting approaches reflect the fact that EPA used sample facilities for the impact analysis and lacks precise information on the profile of ownership of the total population of regulated manufacturers facilities  -  in terms of the number of small entities owning regulated facilities and the number of regulated facilities that any small entity would own. EPA developed the weighting schemes using alternative bounding assumptions about the profile of ownership of regulated facilities by small entities. The weighting schemes provide lower and upper bound estimates of the numbers of small entities, and the numbers of regulated facilities that they own, and accordingly, the number of small entities in each of the cost-to-revenue impact categories (for information on the weighting schemes, see Appendix H of the EA).
      From this analysis, EPA estimates that 17 to 52 small entities own regulated facilities in the six Primary Manufacturing Industries, representing approximately 16 percent of all entities that own regulated facilities in these industries (see Exhibit XI-5).The presence of small entities varies by industry sector.
Exhibit XI-5. Number of small entities that own regulated facilities, by industry
                                   Industry
   Lower-bound estimate of number of entities that own regulated facilities
   Upper-bound estimate of number of entities that own regulated facilities

                                     Total
                                     Small
                                    % Small
                                     Total
                                     Small
                                    % Small
Aluminum
                                                                              4
                                                                              2
                                                                          50.0%
                                                                             11
                                                                              4
                                                                          40.6%
Chemicals and Allied Products
                                                                             30
                                                                              5
                                                                          16.7%
                                                                            121
                                                                             21
                                                                          17.7%
Food and Kindred Products
                                                                              6
                                                                              0
                                                                           0.0%
                                                                             20
                                                                              0
                                                                           0.0%
Paper and Allied Products
                                                                             37
                                                                              7
                                                                          18.9%
                                                                            104
                                                                             23
                                                                          21.8%
Petroleum Refining
                                                                             16
                                                                              2
                                                                          12.5%
                                                                             25
                                                                              2
                                                                           8.4%

Steel
                                                                             13
                                                                              1
                                                                           7.7%
                                                                             32
                                                                              2
                                                                           5.2%
Multiple Industries[a]
                                                                              4
                                                                              0
                                                                           0.0%
                                                                             14
                                                                              0
                                                                           0.0%
Primary Manufacturing Industries[b]  -  Total
                                                                            110
                                                                             17
                                                                          15.5%
                                                                            327
                                                                             52
                                                                          16.0%
 a These are small entities that own regulated facilities from multiple industries.

[b] EPA did not compile comparable information for Other Industries facilities and the entities that own them because it did not have a statistically valid sample of facilities from which to develop such estimates.

c.	Total Number of Small Entities that Own Regulated Facilities
      EPA estimates that between 48 and 104 small entities own regulated facilities in the electric power industry and six primary manufacturing industries together.
2.	Statement of Basis
      As described above, EPA began the small entity impact assessment by first estimating the number of small entities in the two industry segments subject to the final rule: electric generators and manufacturers. EPA next assessed whether these small entities would be expected to incur costs that constitute a significant impact and, finally, assessed whether those entities represent a substantial number of small entities.
      EPA summed annualized after-tax compliance costs for regulated facilities that are assumed to be owned by a given small entity and calculated the costs as a percentage of entity revenue (cost-to-revenue test). EPA compared the resulting percentages to impact criteria of 1 and 3 percent of revenue. EPA assumed that small entities estimated to incur costs below 1 percent of revenue will not face significant economic impacts, while small entities with costs of at least 1 percent of revenue have a chance of facing economic impacts. EPA assumed that entities incurring costs of at least 3 percent of revenue have a higher likelihood of economic impacts.
      For both electric generators and manufacturers, EPA used sample-weighting approaches that provide a range of estimates of the numbers of small entities and regulated facilities that they own.
      Exhibit XI-6 summarizes the Regulatory Flexibility Act analysis results under both weighting approaches for each regulated facilities segment. Overall, the RFA analysis for electric generators found that no small entities would potentially incur a significant impact under the final rule. Specifically, for electric generators, EPA estimates that zero to three small entities will incur costs exceeding 1 percent of revenue, while no small entity will incur costs exceeding 3 percent of revenue. Following EPA's guidance on conducting RFA analyses, the number of small entities above the threshold as a percent of all small entities subject to the rule are zero to 10 percent at the 1 percent of revenue threshold, and zero percent at the 3 percent of revenue threshold.
      The findings for manufacturers are comparable. Specifically, EPA estimates that three to four small parent entities will incur costs exceeding 1 percent of revenue, and zero to one small parent entity will incur costs exceeding 3 percent of revenue. The associated percentages of small entities subject to the final rule are 8 percent to 18 percent at the 1 percent threshold, and zero percent to 6 percent at the 3 percent threshold.
       Combining the electric generators and manufacturers segments, EPA estimates that three to seven small entities will incur costs exceeding 1 percent of revenue, while zero to one small entity will incur costs exceeding 3 percent of revenue. The corresponding percentages of small entities are 4 to 13 percent at the 1 percent threshold, and zero to 2 percent at the 3 percent threshold.

      In summary, under the final rule, EPA estimates that a small number of small parent entities will incur a potentially significant cost impact in the individual regulated industry segments, and overall, for both segments. The maximum number of small entities estimated to incur costs exceeding 1 percent is seven, overall, with three of these small entities in the electric generators segment and four in the manufacturers segment. The maximum number of small entities with costs exceeding 3 percent is one, overall, with no small entities in the electric generators segment and one small entity in the manufacturers segments. In each case, the maximum value reflects the high end of an uncertainty range that is based on different sample weighting approaches. EPA judges that values in the interior of these ranges represent more reasonable estimates of the number of small entities incurring significant impacts. The estimated numbers of entities with significant impacts also represent small percentages of the estimated number of small entities, overall, and in the individual segments. The maximum percentage values at the 1 percent of revenue threshold are 13 percent, overall, 10 percent for electric generators, and 18 percent for manufacturers. At the 3 percent threshold, the maximum percentage values are 2 percent, overall, zero percent for electric generators, and 6 percent for manufacturers. Again, these values reflect the high end of an uncertainty range.
       In view of these very modest impacts, EPA judges that the final rule is not consequential in terms of potential impacts for small entities.
Exhibit XI-6. Estimated cost-to-revenue impact for small entities that own  facilities subject to the regulation
Regulated Segment
Cost impact category

       Cost >=1% of revenue[a]
       Cost >=3% of revenue[a]

 Number of
small entities
 % of small regulated entities[b]
 Number of
 small entities[c]
% of small regulated entities[b]
Electric Generators
                                                                         0 to 3
                                                                      0% to 10%
                                                                              0
                                                                             0%
 Manufacturers[d]
                                                                         3 to 4
                                                                      8% to 18%
                                                                         0 to 1
                                                                       0% to 6%
 Electric Generators and Manufacturers[d]
                                                                         3 to 7
                                                                      4% to 13%
                                                                         0 to 1
                                                                       0% to 2%
 [a] For both electric generators and manufacturers, EPA used sample-weighting approaches that provide a range of estimates of the numbers of small entities and regulated facilities they own (see Section VII(D)(a)(iv) for manufactures and see Section VII(D)(b)(1)(b) for electric generator weighting approaches).
b Percentage of small entities incurring a cost-to-revenue impact involves range estimates in both the numerator (number of affected entities) and denominator (number of regulated entities).
c Entities with cost-to-revenue ratios of at least 3 percent are included in the number of entities with cost-to-revenue such ratios of at least 1 percent.
d Entity counts used in these calculations exclude manufacturers in other industries. EPA estimated that one small parent entity that owns regulated facilities in other industries would incur costs exceeding 1 percent of revenue.

3.	Certification Statement
      Given these findings of very small absolute numbers of small entities estimated to incur significant impacts under the final rule, and low percentages of estimated small entities incurring impacts, I certify that the final rule will not have "a significant impact on a substantial number of small entities" (no SISNOSE), overall and by individual industry segment.
D.	Unfunded Mandates Reform Act (UMRA)
      Title II of the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 1531-1538, requires Federal agencies, unless otherwise prohibited by law, to assess the effects of their regulatory actions on State, local, and Tribal governments and the private sector. Today's rule contains a Federal mandate that may result in expenditures by State, local, and Tribal governments, in the aggregate, or the private sector, of $100 million or more (adjusted annually for inflation) in any one year. Accordingly, under Unfunded Mandates Reform Act section 202, EPA has prepared a written statement, which follows below (see Chapter 11 of the EA).
1.	Summary of Written Statement
a.	Authorizing Legislation
      Today's rule is issued under the authority of CWA sections 101, 301, 304, 306, 308, 316, 401, 402, 501, and 510, (33 U.S.C. 1251, 1311, 1314, 1316, 1318, 1326, 1341, 1342, 1361, and 1370). For detailed information on the legal authority of this rule, see Section III of this preamble.
b.	Benefit-Cost Analysis
      As described above, the costs, benefits and economic impacts reported in this section may be underestimated due to EPA's assumption that facilities with impoundments will qualify as having closed-cycle recirculating systems in the baseline and thus, unless additional controls are required to protect listed species, will incur no technology-related costs. Likewise, for this analysis, because these facilities are assumed not to install compliance technology, EPA also assumed they would achieve no benefits. Accordingly, the benefits reported in this section may be underestimated, based on the assumption of no technology installation for facilities with impoundments. The existing and new unit provisions of today's rule are expected to have total annualized pre-tax (social) costs of $274.9 million. These costs include direct costs incurred by facilities and implementation costs incurred by Federal, State, and local governments. The monetized use and nonuse benefits of the final rule, accounting for the existing and new unit provisions, are estimated to be $32.8 million.  EPA notes that these differences are based on a comparison of a partial measure of benefits with a more complete measure of costs; therefore, the results must be interpreted with caution. For a more detailed comparison of the costs and benefits of the final rule, see Chapter 8 of the EA.
      EPA notes that States may be able to use existing sources of financial assistance to revise and implement today's rule. CWA section 106 authorizes EPA to award grants to States, Tribes, intertribal consortia, and interstate agencies for administering programs for the prevention, reduction, and elimination of water pollution. These grants may be used for various activities to develop and carry out a water pollution control program, including permitting, monitoring, and enforcement. Thus, State and Tribal NPDES permit programs represent one type of State program that can be funded by CWA section 106 grants.
c.	Summary of State, Local, and Tribal Government Input
      EPA consulted with State governments and representatives of local governments in developing the rule. The outreach activities are discussed in Section III.A.3 of the preamble to the proposed rule (see 76 FR 22268, April 20, 2011) and Chapter 2 of the TDD. EPA has also conducted additional outreach since the proposed rule, including several conference calls with the Association of Clean Water Administrators (including numerous states) and small business representatives (including some local government officials). EPA also combined its efforts and collected input from State and local government entities during development of the proposed Effluent Limitations Guidelines and Standards for the Steam Electric Power Generating Point Source Category, which shares many of the same affected facilities as today's final rule; see 78 FR 34530 (June 7, 2013) for more information. State and local officials attended numerous site visits with EPA's staff, enabling EPA to gather their input; see DCNs 10-6510, 10-6518, 10-6520, 10-6521, 10-6523 and 10-6524. EPA also responded to requests for information from multiple State and local governments. EPA also attended conferences and participated in workgroups (such as NARUC's 2013 Winter Committee Meetings) where additional information about State and local government interests were presented. Historically, EPA has also conducted a great deal of outreach in developing the previous 316(b) regulations over the past decade; for example, see the Phase I final preamble (66 FR 65331, December 18, 2001), the Phase II final preamble (69 FR 41677, July 9, 2004), and the Phase III final preamble (71 FR 35037, June 16, 2006).
d.	Regulatory Option Selected
      EPA considered and analyzed several regulatory options to determine the best technology available for minimizing adverse environmental impact. These regulatory options are discussed in Section VI of this preamble. These options included a range of technology-based approaches, from impingement mortality technology at all facilities with a DIF of greater than 50 mgd, to requiring additional impingement mortality controls and intake flow commensurate with closed-cycle cooling for all facilities. As discussed in detail in Section VI, EPA did not select options exclusively because they are the most cost-effective among the options that fulfill the requirements of section 316(b). EPA selected the final rule because it meets the requirement of CWA section 316(b) that the location, design, construction, and capacity of cooling water intake structures reflect the best technology available for minimizing adverse environmental impacts. In addition, EPA has determined that the benefits of the final rule justify the costs, taking into account quantified and qualitative benefits and costs. EPA selected a flexible approach for the final rule from among the options considered; it allows consideration of costs and benefits on a site-specific basis in determining BTA for reducing entrainment and has flexible requirements for reducing impingement mortality.
2.	Impact of Compliance Requirements on Small Governments
      This rule is not subject to Unfunded Mandates Reform Act section 203 requirements because it contains no regulatory requirements that could significantly or uniquely affect small governments (i.e., governments with a population of fewer than 50,000). For its assessment of the impact of compliance requirements on small governments, EPA compared the estimated total costs and costs per facility that small governments would incur with the costs that large governments would incur. EPA also compared costs for regulated facilities owned by small-government entities with costs of regulated facilities owned by non-government entities. The Agency evaluated costs per facility on the basis of both average and maximum annualized cost. The costs for facilities owned by small government entities are less than those estimated for facilities owned by large government entities, or owned by small or large non-government entities. EPA interprets these findings to indicate that the final rule will not uniquely or disproportionately affect small governments.
      Because no manufacturer is government-owned, EPA conducted this analysis for electric generators only.
a.	Government-Owned Electric Generators by Ownership and Entity-Size Category

-

Exhibit XI-7 provides an estimate of the number of non-Federal government entities that own electric generators, by ownership type and size of government entity. As presented in Exhibit XI-7, large government entities own 45 electric generators, and  small government entities own  20 electric generators. Of the 65 facilities owned by government entities, 48 are owned by municipalities, six are owned by States and 11 are owned by other political subdivisions. Tribal governments own no regulated facilities.
Exhibit XI-7. Number of government-owned electric generators, by Size of Government[a]

Entity Type
                                     Large
                                     Small
                                     Total

Municipality

                                                                             29
                                                                             19
                                                                             48
State Government
                                                                              6
                                                                              0
                                                                              6

Other Political Subdivision
                                                                             10
                                                                              1
                                                                             11

Tribal Government
                                                                              0
                                                                              0
                                                                              0

Total

                                                                             45
                                                                             20
                                                                             65

a Counts of explicitly and implicitly analyzed electric generators; these are not weighted estimates. For details, see EA Appendix H.

b.	Compliance Costs for Electric Generators Owned by Small Government Entities
      Exhibit XI-8 presents total, average annualized compliance costs, and maximum annualized compliance costs of the final rule for regulated facilities owned by government (State, local, and Tribal governments) and non-government entities by entity-size category.  For the existing unit provision of the final rule, EPA estimates that small government entities will incur a total annualized cost of $2.6 million, compared to the total cost of $8.6 million incurred by large government entities and $8.5 million incurred by small private entities. On a per facility basis, EPA estimates that a facility owned by a small government entity will on average incur a cost of $0.2 million with a maximum of $0.5 million. The Agency estimates that for a facility owned by large government entity, the average cost of the existing provision of the final rule will be $0.2 million per facility with a maximum of $1.3 million, while for a facility owned by a small private entity the average cost will be $0.2 million per facility with a maximum of $1.4 million. Again, overall, EPA concludes that the compliance requirements of the existing unit provision of today's rule do not significantly or uniquely affect small governments in comparison to either large governments or small private entities. For details of this analysis, see the EA Chapter 11.
Exhibit XI-8. Electric generators and compliance costs by ownership type and size (in millions, 2011 dollars)
Ownership type
                                  Entity size
                      Number of facilities (weighted)[a]
                            Total compliance
costs
                         Average cost
per facility[d]
                           Maximum
facility cost[e]
Final Rule
 Government (excluding Federal)
       SSmall
                                                                             16
                                                                           $2.6
                                                                           $0.2
                                                                           $0.5

       LLarge
                                                                             37
                                                                           $8.6
                                                                           $0.2
                                                                           $1.3
 Private[b]
       SSmall
                                                                             53
                                                                           $8.5
                                                                           $0.2
                                                                           $1.4

       LLarge
                                                                            423
                                                                         $184.3
                                                                           $0.4
                                                                           $5.0
 All Facilities[c]
                                                                            544
                                                                           $220
                                                                           $0.4
                                                                           $5.0
 aFacility counts are weighted estimates and differ from the values reported in Exhibit XI-7, which are un-weighted counts and reflect information for both explicitly and implicitly analyzed electric generators. Sample-weighted values are reported in this table because costs were developed only for the explicitly analyzed electric generators. For details on development of sample weights, see EA Appendix H.
[b]Facility counts and cost estimates reported for the private sector include facilities owned by rural electric cooperatives.
[c]Facility counts and cost estimates reported for All Facilities include facilities owned by the Federal government and costs estimated for these facilities.
[d]EPA calculated average cost per facility using the total number of regulated facilities owned by entities in a given ownership category.
[e]Reflects maximum of un-weighted costs to explicitly analyzed facilities only.

3.	Administrative Costs
      Section 316(b) requirements are implemented through the NPDES permit program. EPA estimates that 46 States and one territory -- the relevant jurisdictions with NPDES permitting authority under CWA section 402(b) -- will incur costs to administer the final rule. EPA estimates that States and territories will incur costs for implementing the requirements of today's rule in four activity categories: (1) start-up activities to learn and understand the requirements of today's regulation and to implement administrative structures and procedures for administering the regulation; (2) initial permit issuance activities; (3) annual activities, including monitoring, reporting and recordkeeping; and (4) non-annually recurring permit-related activities. Exhibit XI-9 presents total annualized costs for each type of administrative activity. EPA estimates that State and local government entities will incur annualized costs of $0.9 million to administer the final rule for electric generators and manufacturers. Monitoring, reporting and recordkeeping costs compose the largest share of administrative costs.
Exhibit XI-9. Annualized government administrative costs (in millions, 2011 dollars)

Cost
Activity
       Electric generators
       Manufacturers
Total
 Start-up Activities
                                       NA
                                                                             NA
 $0.0[a]
Initial Permit Issuance Activities
                                                                           $0.2
                                                                           $0.2
 $0.4
Annual Monitoring, Reporting and Recordkeeping Activities
                                                                           $0.2
                                                                           $0.2
 $0.5
Non-Annually Recurring Permit-Related Activities[b]
                                                                        $0.0[b]
                                                                          $0.0
 $0.1
Total
                                                                           $0.5
                                                                           $0.4
 $0.9
 [a] Costs associated with start-up activities are estimated for both electric generators and manufacturers; these costs are less than $20,000.
[b] Costs are less than $50,000.

E.	Executive Order 13132: Federalism
      Under E.O. 13132, EPA may not issue an action that has federalism implications, that imposes substantial direct compliance costs on the State and local governments, and that is not required by statute, unless the Federal government provides the funds necessary to pay the direct compliance costs incurred by State and local governments, or EPA consults with State and local officials early in the process of developing the final rule.
      The final rule does not have federalism implications. It will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in E.O. 13132.This final rule would not alter the basic State-Federal scheme established in the CWA under which EPA authorizes States to carry out the NPDES permitting program. Prior to this rule, authorized States were required to issue NPDES permits including requirements for CWISs on a case-by-case BPJ basis. 40 CFR. 125.90(b). EPA expects that today's rule will have little to no effect on the relationship between, or the distribution of power and responsibilities among, the Federal and State governments.
      EPA estimates an average annual burden of $0.9 million, for State and local governments to collectively administer the existing unit provision of the final rule. The rule will also impose a compliance cost burden on State and local governments, if those government entities own facilities that are subject to today's rule. EPA has identified 554 regulated facilities that are owned by State or local government entities; the Agency estimates that under the existing unit provision of the final rule these facilities will incur an average annual compliance cost of approximately $0.2 million per facility. Because this rule does not have federalism implications, the requirements of section 6 of E.O.13132 do not apply to this rule.
F.	Executive Order 13175: Consultation and Coordination with Indian Tribal Governments
      This action does not have Tribal implications, as specified in E.O. 13175 (65 FR 67249, November 9, 2000). It would not have substantial direct effects on Tribal governments, on the relationship between the Federal government and the Tribes, or the distribution of power and responsibilities between the Federal government and Tribes as specified in E.O. 13175. The national cooling water intake structure standards would be implemented through permits issued under the NPDES program. No Tribal governments are authorized pursuant to CWA section 402(b) to implement the NPDES program. In addition, EPA's analyses show that Tribal governments own no facilities subject to today's rule; thus, this rule does not affect Tribes in any way now or in the foreseeable future. Thus, E.O. 13175 does not apply to this action.
G.	Executive Order 13045: Protection of Children from Environmental Health Risks and Safety Risks
      This action is not subject to E.O. 13045 because it does not establish an environmental standard intended to mitigate health or safety risks. This rule establishes requirements for cooling water intake structures to protect the environment.
H.	Executive Order 13211: Actions that Significantly Affect Energy Supply, Distribution, or Use
      E.O. 13211 (66 FR 28355, May 22, 2001) requires EPA to prepare and submit a Statement of Energy Effects to the Administrator of the Office of Information and Regulatory Affairs, Office of Management and Budget, for actions identified as significant energy actions. On the basis of the Office of Management and Budget's guidance for assessing the potential energy impact of regulations, the Agency anticipates that today's rule may have a significant adverse effect on the supply, distribution, or use of energy, thus requiring EPA to include a Statement of Energy Effects.
      The Agency assessed the energy effects of today's rule, specifically, the rule's effect on energy supply, distribution or use in the electric power sector, as required under E.O. 13211. In its energy-effects assessment, EPA relied on Integrated Planning Model (IPM) analyses undertaken by EPA for the final rule. Based on that analysis, described in Section IX(D)(1)(d) of this preamble (Assessment of the Impacts in the Context of Electricity Markets) and in more detail in Chapter 6 of the EA report, EPA finds that the  compliance requirements of the final rule may affect the electric power sector in ways that would constitute a significant adverse effect under E.O. 13211, and thus includes a Statement of Energy Effects in the economic analysis.
      The Agency's analysis found that the final rule will not reduce electricity production in excess of 1 billion kWh hours per year (or one thousand GWh), will not increase the cost of energy production in excess of 1 percent, will not increase dependence on foreign supply of energy, and will not significantly affect domestic coal production. However, the final rule will result in net retirement of 998 MW of generating capacity, which exceeds 500 MW of installed capacity, the threshold of significant adverse effect identified in the OMB Implementation Guidance for E.O. 13211. EPA notes that, with only one exception, these retirements involve older, less efficient generating units with very low capacity utilization rates. The 998 MW of net retired capacity is replaced by 589 MW of new capacity; therefore, because older and less efficient capacity is replaced by new, more energy-efficient, and less polluting capacity, these retirements mean that 409 MW less capacity is needed to fulfill the same demand.
      For more detail on the estimated energy effects of the final rule, see Chapter 12 of the EA, which is in the public docket.
I.	National Technology Transfer and Advancement Act
      Section 12(d) of the National Technology Transfer and Advancement Act of 1995, Public Law No. 104-113, 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its regulatory activities unless doing so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. The National Technology Transfer and Advancement Act directs EPA to provide Congress, through the Office of Management and Budget, explanations when the Agency decides not to use available and applicable voluntary consensus standards.