One commenter ( OAR 2002 0056 5517) reports that it recently received an e mail communication from Professor Gary Myers of Rochester University who leads the child development study of prenatal MeHg exposure from ocean fish consumption in the Seychelles Islands. His e mail message concerns EPA's stated intention outlined in the NODA to analyze whether data from the various major MeHg exposure effects studies, such as those of the Seychelles and Faroe Islanders, can be integrated. Dr. Myers observes, " I do not think there is any way to compare the two [ Seychelles and Faroe Island] studies regarding exposure. They are 9 247 simply different." In view of this communication, the commenter suggests that EPA confer further with Dr. Myers on this matter to clarify the specifics of his expressed concern.

Response:

Please see Chapter 9 of the RIA for a discussion of the derivation of a dose response function using both the Seychelles and Faroes data.

Comment:

One commenter ( OAR 2002 0056 5447) stated that EPA's NODA poses a number of questions related to modeling runs that have been performed to simulate electric system operation and decision making to predict how utilities would comply with EPA's two proposed regulatory options. 69 Fed. Reg. 69866 69872. EPA states that modeling predictions of how electric generation would shift in response to the Hg rule is relevant because EPA is required to examine " cost, nonair quality health and environmental impacts, and energy requirements" under both Clean Air Act ( CAA) § 111 and 112( d). 69 Fed. Reg. 69866 The commenter also noted that EPA also requests comments on its proposed revisions to its benefits assessment under EO12866. 69 Fed. Reg. 69,872. EO12866 states that " agencies should assess all costs and benefits of available regulatory alternatives." EO12866, Section 1. Costs and benefits must be considered on a " net" basis, meaning both positive and negative public health effects of a regulation must be considered together. Id. The fact that it is difficult to quantify certain costs and benefits does not mean these costs and benefits may be ignored. Under EO12866, "[ c] osts and benefits shall be understood to include both quantifiable measures ( to the fullest extent that these can be usefully estimated) and qualitative measures of costs and benefits that are difficult to quantify, but nevertheless essential to consider." Id. EPA's analysis of the " cost [ and] nonair quality health and environmental impacts" and its EO12866 benefits assessment are defective because they fail to consider significant societal costs associated with unduly stringent Hg regulations. Indeed, a number of outcomes forecast by the modeling performed in this docket ( e. g., plants shutting down) would cause significant economic and human health impacts that are overlooked in EPA's analysis. If coal plants are modeled to shut down ( e. g., Cinergy's model of " Stringent MACT Plus CAIR," 69 Fed. Reg. 69868, col. 3) or reduce capacity factors, these shut downs will cause the economic impacts of increased gas and electricity prices. These higher prices will, in turn, cause higher costs in the manufacturing sector, loss of jobs, and the loss of energy security. According to a recent study, " replacement of U. S. coal fueled power could impact household income by an estimated $ 125$ 225 billion in 2010,"

In addition, forcing a shift in the nation's fuel supply from coal to natural gas will result in significant increased risks to public health. Depending on the models used, removing coal from America's energy mix would directly result in anywhere from 7,000 51,000 premature adult deaths per year. However, severe mortality impacts would result even if EPA's regulations do not cause a complete shut down of coal fueled electricity, but only cause some shift from low cost coal generation to higher priced gas generation. One model shows that an aggregate 9 248 reduction in household income of $ 8.9 million induces one additional adult death. These deaths would fall disproportionately on lower income households.

Modeling outcomes that predict some coal fueled units will be shut down or run at decreased capacity must incorporate all potential impacts of such shut downs or decreases in capacity when assessing the costs of the regulation. At this point, EPA's forecast modeling and benefit analysis does not consider the societal impacts of regulations that would cause power plants to shut down or run at decreased capacity. Until such analysis is provided, EPA has not met its obligation under EO12866 to assess all the costs and benefits of its Hg regulation and to do so on a net basis. For the same reason, EPA will have failed to fully assess the " cost, nonair quality health and environmental impacts" of the regulation under CAA § 111 and 112( d).

Response:

The comment raises issues under the general broad issue of correctly differentiating between social costs and economic impacts. It is critical that proper analysis not violate economic theory and the principles of benefit cost analysis in doing so. The commentor suggests EPA should consider the following when calculating full societal costs:

( 1) potential shut down of or decreased capacity in EGUs ( 2) Higher energy costs ( 3) Loss of jobs ( 4) Loss of income ( 5) Loss of energy security We address each of these separately.

( 1) Potential shut down or decreased capacity in EGUs. In fact the IPM model used by EPA to estimate costs and other impacts, does provide an estimate of EGU shutdowns and decreased capacity, if relevant. The IPM model estimates the costs of meeting the U. S. demand for electricity. To the extent that some EGUs shutdown, the model must replace that lost capacity with other capacity. The cost of replacing this lost capacity is estimated by IPM. Hence, we want to be clear that the cost of plant shut downs ( in the form of higher electricity prices) is calculated and is part of our cost estimates we routinely calculate.

( 2) Higher energy costs. It is true that pollution control requirements can lead to higher energy prices. The IPM model does provide estimates of higher energy prices as a result of the regulation.

( 3) Loss of jobs. The commentor argues that the increased cost of electricity will lead to loss of jobs. It is true that higher electricity prices can ripple through the economy and disrupt particular industries. However, to a first approximation, the increased spending for pollution control equipment creates the same number of jobs as the loss in jobs from higher electricity prices. Hence, we generally consider job loss to be serious economic impact, worthy of 9 249 consideration, but it is not, in general, considered to be a " net" cost of a regulation. In fact, job creation by a regulation is one component of the costs. WOrkers who make pollution control equipment must be paid. This is part of the cost of buying pollution control equipment.

There is, however, one mechanism that can lead to reduced labor hours in the economy that can be a cost. In the 1990' s and beyond, economists have identified and investigated the so called tax interaction effect. The problem arises because we the economy already taxes labor services a great deal. These labor taxes tend to generate too little labor being provided to the economy. Any regulation that gives rise to higher prices, can further depress the real wage. In doing so, workers provide even less labor services to the economy. While this is conceptually understood by economic modelers, the empirical estimates of this effect vary widely. Further, the benefits of environmental improvement tend to raise the productivity of the American worker. Reduced mercury, for example, will raise IQ levels in the economy. As workers get smarter, productivity increases. Hence, these type of interaction effects can affect both the costs and benefits.

( 4) Loss of income  as in the case of jobs, some workers will find themselves with higher income and some with lower income. In general, job losses ( or gains) are not counted as social costs of the regulation.

( 5) Loss of energy security. The IPM model does give estimates of the source fuels for the production of electricity. We will then be able to estimate whether imports of oil or natural gas ( or other forms of energy) will go up or down as a result of this regulation.

Comment:

One commenter ( OAR 2002 0056 5458) believed the benefits analysis must be focused on the neurodevelopmental health of children. In the benefit analysis referenced in the proposal and identified in the NODA, IQ reduction was chosen as the health endpoint to quantify the benefits of reducing MeHg exposure in children. The commenter is concerned about the use of IQ as the endpoint for benefits quantification across the three major epidemiological studies used to develop the MeHg reference dose ( RID) because IQ was only directly measured in the New Zealand study. Based upon notes from the Mercury Neurotoxicity Workshop, the selection of IQ as the neurological endpoint for quantification seems to be based almost entirely on the fact that decrements in IQ can be monetized. The commenter will reserve its comments on this aspect of the benefits analysis until it is available for public review and comment.

Response:

Please see Chapter 9 of the RIA for a discussion of the derivation of the dose response curve and Chaters 10 and 11 for a discussion of the monetized benefits.

Comment:

One commenter ( OAR 2002 0056 5488) said that to date, the EPA has not assessed the 9 250 public health benefits from reduced Hg exposure to the population, instead relying on analyses of public health co benefits resulting from reduced exposure to criteria air pollutants. The NODA expresses the agency's intent to conduct analyses of the benefits resulting from avoidance of IQ reduction in children, but it does not specify the range of regulatory options to be considered. Within the NODA, the only two scenarios mentioned are the base case and the reductions afforded by the proposed CAMR. The commenter believed that such a limited analysis is entirely insufficient to justify the setting of Hg reduction levels on a health basis. The commenter requested that the EPA analyze and compare the public health benefits associated with Hg reduction levels that are more protective than those proposed under the CAMR and more consistent with Hg reductions levels demonstrated above to be achievable.

In addition, just as the agency relied on the co benefits from reduction of criteria air pollutants in its initial benefit estimate of the proposed CAMR, in the revised benefits analysis, co benefits from any additional reduction of criteria air pollutants as well as co benefits of reductions in other toxic air pollutants must be added on to the benefits from avoidance of IQ reduction related to reduced exposure to MeHg in each Hg reduction scenario modeled.

The commenter agreed with the agency that the avoidance of IQ reduction is the best studied and most easily monetized benefit of reduced MeHg exposure, and this outcome should be included in the revised benefits analysis. But other serious health effects must also be accounted for in EPA's benefits analysis. EPA's benefits analysis must give full consideration to the impacts on the immune and cardiovascular systems in addition to the nervous system. There is compelling evidence that additional health benefits result from reduced population exposure to MeHg beyond avoidance of IQ reduction. The commenter, therefore urged the agency to include in its analysis the cardiovascular and immune system effects of Hg and expressly acknowledge that the actual health benefits are greater than those estimated based on consideration of IQ effects ( or reduced exposure to criteria air pollutants) alone. In addition, the agency must account for benefits from avoided neurological effects such as motor dysfunction that are not captured by estimates of lost income from IQ reduction.

The selection of an appropriate dose response model must ultimately depend on which model best fits the data. The combined data from the Seychelles, Faroe Islands, and New Zealand studies are well modeled by a linear dose response curve. The use of a linear instead of a threshold model is supported by the EPA IRIS database, which notes that no threshold was detected for MeHg neurotoxicity in the Faroe Islands study, as well as the National Research Council report on MeHg. Use of a linear model will also facilitate the estimation of health benefits from MeHg reductions below the modest levels currently proposed in the CAMR. Accordingly, the best available science shows that a linear dose response model should be used to properly estimate the health benefits of Hg pollution control options.

Given the complexity of this type of analysis and its application in the regulatory setting, the commenter requested that all assumptions, methods and uncertainties in the modeling of Hg reduction benefits be clearly and publicly documented and thoroughly peer reviewed by a balanced body of outside experts. 9 251 Response:

The RIA includes an assessment, to the extent possible given our scientific understanding of mercury and its behavior in the environment and impacts on human health, of the health benefits associated with the proposed regulatory options. Due to limitations in our current understanding of these technical areas related to mercury this benefit analysis is limited to the self caught freshwater fish consumption pathway and to IQ deficits in prenatally exposed infants. In keeping with precedent in evaluating benefits of air regulations ( REFERENCE), cobenefits ( in this case resulting from potential reductions in direct PM2.5) are also included in the RIA.

EPA acknowledges that emission control equipment used to reduce mercury emissions may reduce emissions of other pollutants including PM and associated HAPs. While EPA has included an analysis of potential cobenefits associated with reductions in direct PM2.5, limitations in our current understanding of differential toxicity prevent us from modeling health benefits from reduced exposure to HAPs associated with that PM. Similarly, while EPA concurs with the National Academy of Sciences, that a variety of health endpoints may be associated with methylmercury exposure in addition to IQ ( e. g., immune system effects, cardiovascular mortality and additional neurodevelopmental endpoints), there is insufficient peer reviewed evidence at this time for conducting formal analysis of these endpoints for inclusion in the primary benefits estimate.

Comment:

One commenter ( OAR 2002 0056 5502) referenced MeHg and Cardiovascular Effects. Evidence that exposure to MeHg via fish consumption leads to a high risk of adverse cardiovascular events is generally lacking; published findings are contradictory and inconsistent nature, and associations weak. Multiple contributing factors for cardiovascular health and striking cultural differences in coronary heart disease rates contribute to overall weakness in findings. It does not appear that there is " emerging evidence" that MeHg has major effects on cardiovascular systems, nor is there good evidence for fish Hg diminishing the cardio protective effect of fish intake.

IQ and Neurobehavioral Tests. IQ neither meets requirements for a well defined health effect for MeHg exposure, nor has it been used as a primary health endpoint in the children's MeHg studies. Major barriers to conducting a meta analysis of the Faeroe Islands, New Zealand and Seychelles Islands studies are: the heterogeneity of the study designs; the neurobehavioral test batteries administered; the ages at testing; the lack of a consistent pattern of significant results across studies ( most results are non significant; however); the differences in study populations; and the differences in confounders measured and included in the final multivariate models. These inconsistencies and other shortcomings are major barriers to conducting a valid meta analysis of the cohort studies to date.

Use of a Linear Dose Response Model. Alternatives to the K= 1 model need to be 9 252 considered. Published analyses of the Seychelles study suggest evidence for a non linear association for one or two neurobehavioral test endpoints with a threshold that is consistent with previous estimates from the Iraqi study. Non linear models need to be applied to New Zealand and Faroes results prior to making a final determination of the best model to fit these data. Further, a linear dose response model is questionable given that the standard RID established by EPA assumes a threshold dose below which there is not likely to be an appreciable risk of deleterious effects during a lifetime.

Response:

EPA does not have access to the study data for the three key studies. The only data available to EPA are regression coefficients and other statistics that have been published by the study investigators. Therefore, EPA is not able to conduct any modeling that would examine alternative shapes to the dose response relationship, including non linear models. EPA's analysis involves a statistical integration of linear dose response functions that have been reported by the study investigators. We believe that use of a linear function, in conjunction with using a nonthreshold model, in our analysis is well justified by the following considerations: 1) The National Research Council's 2000 report on methylmercury used linear model results for deriving benchmark doses, and cautioned against use of supralinear models; 2) the Faroe Islands research team reported that K power models ( with the NRC recommended constraint of K > 1, i. e. with supralinearity excluded) fit best with the linear specification, i. e. K= 1; 3) linear model results are available for IQ for all three studies, and no non linear model results are available from the three studies ( except for Faroes log model), and raw data are not available to us for conducting analysis of dose response shape or other issues; and 4) the lowest exposures in the Faroe Islands study overlap with U. S. exposure range, although there is less overlap with the other two studies. Nonetheless, EPA's Reference Dose and the analysis supporting its derivation was reviewed positively by the National Academcy of Sciences and the Agency continues to support its level and the implications. We conclude that any analysis of the IQ benefits needs to deploy several models  with a threshold and without to capture the full range of uncertainty. EPA acknowledges that there are complexities, including a variety of potential confounders, that must be considered in relation to potential cardiovascular mortality linked to methylmercury exposure. For additional discussion of this endpoint, see Appendix D.

Comment:

One commenter ( OAR 2002 0056 5535) stated that MeHg poisoning incidents, particularly the well known incident in Minamata, Japan, have established Hg as a neurodevelopmental toxicant. Three prospective epidemiological studies, in the Faroe Islands, the Seychelles, and New Zealand, have been singled out over the past five years for the development of dose response calculations. The study in the Faroe Islands documented subtle deficits of several functional domains at prenatal MeHg exposure levels previously thought to be safe. This finding was in agreement with the New Zealand study, as well as cross sectional epidemiological studies in French Guiana and the Amazon that also showed effects but do not lend themselves to dose response analysis. Results from the Seychelles have not been concordant, however; to date, 9 253 this prospective study has not shown effects. In keeping with prevailing standards of public health protection, EPA and the NAS have used the Faroe and New Zealand studies as the basis for regulatory decision making.

The Faroese study recently has been updated to include state of the art neurological testing administered to the cohort of children under study as they have matured. Previously, in a 1997 report on the Faroese population, researchers examined children at age 7 and reported on abnormalities in CNS mediated functions ( such as achievement of developmental milestones) and sensitive measures of neurological function ( such as evoked potentials, visual and auditory acuity, and neuropsychological functions). The new data cover subsequent examinations of the Faroese children at age 14 years; tests included brainstem auditory evoked potentials ( BAEP's). The authors report that the signal from the acoustic nerve to the brainstem was significantly delayed in a dose related fashion with prenatal exposure to Hg. Because they observed this effect at both 7 and 14 years, the authors suggested that this effect of Hg on the developing brain is irreversible. This Hg associated delay in transmission appeared to be parallel to the effects on the child's cognitive function. The measurement of BAEPs is an objective assessment that is independent of confounding factors, such as age and socioeconomic. Most concerning, these children had an average exposure similar to the " safe" limit ( i. e., the reference dose) recommended by EPA.

Although the mechanism by which MeHg adversely affects the developing brain is not completely understood, there are numerous ways that the compound has been shown to affect neurons. It causes biochemical and structural changes in mitochondria ( the energy producer in the cell), disrupts protein synthesis, causes membrane damage in nerve cells, and may create free radicals that damage lipids and result in neuronal damage. Oxidative damage may be a factor in MeHg toxicity, since concentrations of the repair enzyme glutathione decline and then increase after exposure to MeHg. MeHg also has been shown to disrupt cell division and cell migration by disrupting structural microtubular proteins. None of these effects is likely to have a clear threshold below which it does not occur.

Other Important Health Endpoints Beyond neurotoxicity, research links Hg with a host of other health effects. First, the impact of Hg on overall growth and development has been supported by data published since 2000. In the Faroese cohort, pre and postnatal MeHg exposure was found to be associated with decreased postnatal growth, particularly before 18 months of age. The authors found that, " irrespective of duration of breast feeding, a doubling of the Hg concentration in cord blood was associated with a decrease in weight and height." Second, Hg may have immunotoxic effects. Hg induces autoimmune disease in rodents. Highly susceptible mouse strains develop multiple autoimmune manifestations after exposure to inorganic Hg, including proliferation of lymphocytes, elevated levels of autoantibodies, overproduction of immunoglobulins ( IgG and IgE), and circulating immune complexes that can clog the kidney and vasculature. Now, a recent cross sectional study provides evidence that a population of Hg exposed adults living in the Amazon region has an increased prevalence of elevated autoantibodies, indicative of autoimmune dysfunction. 9 254 Third, several studies have linked Hg exposure to cardiovascular disease. Although some fish species contain beneficial omega 3 fatty acids, and fish is a low fat source of protein, recent studies raise the possibility that moderate Hg content in fish may in fact diminish the cardioprotective effect of fish intake. A 2000 study reported an association between moderate hair Hg content and accelerated progression of arteriosclerosis in the carotid arteries leading to the brain ( determined by ultrasonographic assessment of common carotid intima media thickness) in a prospective study among 1,014 men aged 42 60 years in Finland. Hair Hg levels greater than 2 ppm ( well within the range of the U. S. adult population) showed a doubling of the risk of cardiovascular mortality. This study was recently updated and reported that Hg in hair above 2 ppm may be a risk factor for acute coronary events and cardiovascular disease, coronary heart disease, and all cause mortality in middle aged eastern Finnish men.

Similarly, a study published in the New England Journal of Medicine reported that toenail Hg level ( an indicator of total Hg exposure) was directly associated with the risk of myocardial infarction. This case control study was conducted in eight European countries and Israel, and studied 684 men with a first diagnosis of myocardial infarction. The authors report that the Hg levels in the patients were 15 percent higher than those in controls ( 95 percent confidence interval, 5 to 25 percent). The risk factor adjusted odds ratio for myocardial infarction associated with the highest as compared with the lowest quintile of Hg was 2.16, a more than twofold increase in the risk. The authors suggest certain mechanisms that may contribute to this effect, including inactivating the protective, antioxidant properties of the repair enzymes glutathione or catalase, inducing cell membrane damage by lipid peroxidation, promoting platelet aggregability and blood coagulability, and affecting the inflammatory response, among several others.

Although a third study on cardiovascular health was unable to replicate these findings, the study population consisted largely of dentists who had occupational exposure to elemental Hg. Since Hg exposure measurements in this study were based on total Hg, the elemental Hg exposure could have confounded detection of a MeHg effect. In fact, when the dentists were removed from the study, an association with cardiovascular outcomes ( albeit not statistically significant, possibly due to the smaller sample size) was seen with Hg exposure.

The new data on MeHg indicate that neurodevelopmental effects are likely to be permanent and to be present according to objective measures   at Hg levels lower than previously reported. It is also increasingly clear that the neurodevelopmental endpoint is not the only endpoint of concern for human health, and that the immunotoxicity of Hg will be an area of increasing concern in the future. The immunotoxicity issue is reason for an especially precautionary approach to development of a benefits calculation. The data on cardiovascular endpoints are sufficiently robust at this point that they should be included in a benefits assessment for Hg. The public health and economic burden of cardiovascular disease in the U. S. is very significant, and the effect of Hg, even if relatively modest, is significant and worthy of inclusion in the agency's estimate of the benefits of Hg regulation. In our opinion, it would be a mistake for the agency to ignore any of these endpoints in its benefits assessment, even though the commenter agreed that neurodevelopment in children is an especially important endpoint. 9 255 The focus on neurodevelopmental health of children Although the commenter agreed that a credible benefits assessment for this rule should address the well established neurodevelopmental health effects of Hg toxicity, they did not believe this should be the exclusive focus. A July 2000 review by the National Academy of Sciences ( NAS) concluded that neurodevelopmental effects were the most sensitive and well documented effects of MeHg exposure, based on the best available data at the time. EPA's RfD of 0.0001 milligrams per kilogram of body weight per day ( mg/ kg/ day) derives from a neurodevelopmental endpoint, and the NAS determined that EPA's RfD " is a scientifically justified level for the protection of public health." The RfD was based on three epidemiological studies of prenatal MeHg exposure in the Faroe Islands, New Zealand, and Seychelles Islands. These studies examined neurodevelopmental outcomes through the administration of numerous partial or full assessments of IQ, problem solving, social and adaptive behavior, language functions, motor skills, attention, memory, and other functions. Although the NAS panel found that all three studies are well designed, prospective, longitudinal studies, it also concluded that, " given the strengths of the Faroe Islands study, it is the most appropriate study for deriving an RfD."

However, as discussed above, Hg exposure has also now been linked to immune system dysfunction, other developmental effects, and cardiovascular disease. These potentially permanent, severe, and life threatening effects are associated with environmentally relevant levels of Hg exposure. When calculating the benefits of reducing Hg exposure it would be a mistake to focus on the neurodevelopmental outcomes to the exclusion of all of these other important health endpoints. To do so would ignore the extensive new scientific information on MeHg and would also seriously underestimate the health benefits of Hg reduction.

IQ as an endpoint for quantification of neurodevelopmental effects EPA asks for comments regarding whether IQ is an appropriate metric for quantifying neurodevelopmental impacts. It is not a sufficient one. The array of neuropsychological deficits associated with even low levels of Hg exposure during early life stages includes behavioral alterations and impaired language, attention, memory, and, to a lesser extent, visuospatial and motor functions. Most concerning, some of these effects are detectable at exposure levels currently considered acceptable by EPA. It is clear that Hg effects are not localized to discrete brain regions when these exposures occur prenatally or perinatally, and any credible benefits analysis must quantitatively account for the broad spectrum of brain damage associated with Hg. Measurements of IQ are inadequate to capture fully the profile of Hg neurodevelopmental toxicity; IQ tests do not capture impairments of manual dexterity, motor functions, and hand eye coordination, all known to be associated with Hg exposure. Accordingly, to be more credible, a benefits analysis must explicitly calculate the sweeping benefits of reduced exposure for protection of the fragile, complex developing nervous system.

Quantification and economic valuation of neurodevelopmental and other health effects An economic valuation will not be complete unless it can account for adverse effects of 9 256 early life exposure to Hg on cognitive abilities, neurodevelopmental deficits such as motor disabilities and hand eye co ordination, immune system toxicity, impaired growth and development, and cardiovascular disease. A full economic valuation of Hg toxicity must quantitatively account for the full array of neurodevelopmental deficits known to be associated with Hg, such as learning, memory, IQ, visuospatial, and motor deficits. In addition, an economic valuation that claims to represent Hg toxicity must also account for Hg associated immunotoxicity, reproductive effects and cardiovascular disease risks. If this cannot be done, perhaps because the data are not sufficiently robust for such a calculation, then the resulting uncertainty and potential for error must be stated, and incorporated into the final analysis.

The commenter supported a comprehensive approach for the development of a credible benefits analysis, but emphasized that any such analysis must consider the variability within the data and the uncertainty inherent in the exposure assessment and model methodology. It may be helpful in developing an integrative, data comprehensive benefits model, for EPA to review the NAS report. The NAS used data from the Faroe Islands, New Zealand, and the Seychelles Islands studies to develop an integrative analysis of Hg toxicity. EPA itself developed the RfD of 0.1 g/ kg body weight per day for MeHg by integrating data from these three studies, so it is apparent that the agency is capable of such an integrated assessment. It is consistent with EPA practice to consider the weight of evidence of the available literature. The NAS approach relied upon a hierarchical random effects model designed to take proper account of appropriate study to study and outcome to outcome heterogeneity across the studies. Such a model provided a useful tool for separating random versus systematic variation and thereby provides more stable estimates of study specific and outcome specific benchmark doses. The effect of the hierarchical modeling was to smooth away much of the random variability observed in the original data, particularly the more extreme values.

Use of the K= 1 model PA seeks comment on whether, by using a K model with K= 1, it should presume that reducing Hg exposure will reduce adverse health effects in a linear fashion. The researchers analyzing data from the Faroe Islands study have investigated various models applied to their data set. They have found that a log curve is the best fit with the data, but the improvement over a linear curve is of borderline statistical significance ( p= 0.06). Accordingly, the researchers have used a linear model for their analyses. It appears that the choice of either a linear or a log model is reasonable. It would be unreasonable, however, for the agency to continue the past practice of using a threshold model with a NOAEL, as such a model is unsupported by the existing data.

An alternative approach could involve doing a benchmark dose extrapolation that incorporates all available data on Hg toxicity. The benchmark dose ( BMDL) method is coming into increasing use as a pragmatic way of dealing with dose response relationships deriving from multiple endpoints and multiple datasets, without a clear indication of a threshold, such as the Hg data. The BMDL is the lower 95 percent confidence limit of the dose of a substance that increases the risk of an abnormal response by a benchmark response, such as a 5 10 percent response compared with a reference population. Such an approach would require the use of an 9 257 uncertainty factor; because a BMDL is not a no effect level, an additional multiplier is necessary to provide sufficient assurance that the public at large would be protected from an adverse health effect.

Use of a linear dose response model and the appropriateness of assuming that Hg has a threshold for adverse health effects The data from the Faroe Islands study do not reveal evidence of a threshold below which Hg does not exhibit some toxic effect on the developing brain. Mechanistic data also support the lack of a threshold, as Hg has numerous adverse effects on neurons that would not be expected to have a threshold of action. Therefore the choice of a linear model makes the most sense for analysis of the MeHg data.

Recent data from the Faroe Islands study indicate that the BMDL for deficits in neurophysiological function is more likely to be associated with 5

g/ g Hg in hair, instead of the 11

g/ g that the NAS calculated, meaning that the neurological effects of Hg have been demonstrated at an even lower dose than previously reported. The difference is due to exposure misclassification. All calculations so far have assumed that the exposure estimates were more precise than they really are. The Faroe Islands research team recently showed that hair Hg is somewhat imprecise that is, in this case, how well the hair measurements reflected the true cord blood Hg exposure. Imprecise exposure assessments result in an underestimation of the true magnitude of the effect of an exposure to MeHg. Recalculation of the benchmark dose indicated that it had been overestimated by a factor of two. Accordingly, recalculating the exposure limit using the adjusted benchmark dose would result in a limit approximately one half the one used by EPA in calculating the RfD.

The commenter was also concerned about potential industry pressure on EPA to revise the RfD or to undermine any conclusions the agency has made about risks to the U. S. population. The commenter was aware that agency officials met with seafood industry representatives in February 2004. Accordingly, the Clean Air Task Force requested disclosure of materials related to this meeting ( and any other materials related to this or other similar meetings) pursuant to the Freedom of Information Act, 5 U. S. C. § 552. Although EPA received that request on November 2, 2004 and is required to " respond to requests no later than 20 working days from the date the request is received and logged in," 40 CFR § 2.104( a), the agency has not provided the Clean Air Task Force with a substantive response. The commenter is looking forward to the agency's response so that they can be assured that the seafood industry has not prompted EPA's newfound interest in the RfD.

Response:

In developing the RfD, the Agency did rely on benchmark dose modeling as the most appropriate method of quantifying the dose effect relationship in the three principal studies, which was also the recommendation of the NRC ( 2000). EPA chose not to make a numerical adjustment between cord blood and maternal blood mercury. The relationship between 9 258 cord blood and maternal blood mercury is considered subject to variability and uncertainty, and was included in the determination of the uncertainty factor.

The RIA includes an assessment, to the extent possible given our scientific understanding of mercury and its behavior in the environment and impacts on human health, of the health benefits associated with the proposed regulatory options. Due to limitations in our current understanding of these technical areas related to mercury this benefit analysis is limited to the self caught freshwater fish consumption pathway and to IQ deficits in prenatally exposed infants. In keeping with precedent in evaluating benefits of air regulations ( REFERENCE), cobenefits ( in this case resulting from potential reductions in direct PM2.5) are also included in the RIA.

EPA concurs with the National Academy of Sciences, that a variety of health endpoints may be associated with methylmercury exposure in addition to IQ ( e. g., immune system effects, cardiovascular mortality and additional neurodevelopmental endpoints). However, there is insufficient peer reviewed evidence at this time for conducting formal analysis of these endpoints for inclusion in the primary benefits estimate.

EPA acknowledges that emission control equipment used to reduce mercury emissions may reduce emissions of other pollutants including PM and associated HAPs. While EPA has included an analysis of potential cobenefits associated with reductions in direct PM2.5, limitations in our current understanding of differential toxicity prevent us from modeling health benefits from reduced exposure to HAPs associated with that PM. Similarly, while EPA concurs with the National Academy of Sciences, that a variety of health endpoints may be associated with methylmercury exposure in addition to IQ ( e. g., immune system effects, cardiovascular mortality and additional neurodevelopmental endpoints), there is insufficient peer reviewed evidence at this time for conducting formal analysis of these endpoints for inclusion in the primary benefits estimate.

Comment:

One commenter ( OAR 2002 0056 5465) stated that at the most fundamental level, EPA's proposed revised benefits assessment appeared to suffer from the same flaw that undermined its initial benefits assessment for the CAMR: while EPA proposed to account for the costs and benefits of the Maximum Achievable Control Technology ( MACT) and cap and trade alternatives as proposed by EPA in its January 30,2004 proposed rule, EPA failed to consider whether a more protective rule would produce an even more favorable accounting of costs and benefits. As Professors Heinzerling and Steinzor document, this failure stood in stark contrast to the current practice of the Office of Management and Budget's Office of Information and Regulatory Affairs in implementing EO12866. Moreover, as numerous commenters have pointed out, EPA's proposed approaches rest on dubious scientific and legal footing; a legally defensible rule would in fact require much more stringent reductions in Hg emissions from coal fired utilities. Against this backdrop, EPA's failure to consider the costs and benefits of a more stringent rule is particularly egregious. 9 259 Second, as EPA now concedes, it cannot accurately assess the benefits of Hg emissions regulation without considering the independent benefits of reducing the adverse effects of Hg contamination. However, in order to produce an accurate accounting, EPA must not define narrowly the benefits at issue, i. e., EPA cannot consider only a subset of the direct effects on human health ( and then only those that are quantifiable or monetizable). Instead, EPA must consider broadly the direct and indirect effects on human health and well being. Included within this broader definition are those effects felt not only by individual humans but also by relevant groups ( e. g., adverse impacts on the various Ojibwe and other tribes' ability to continue important traditional, cultural and religious practices). EPA must also consider the effects on ecological health. The commenter thus urged EPA to refer to those tribal and other commenters, e. g., the Forest County Potawatomi Community and the Fond du Lac Tribe, that have know ledge of and are uniquely positioned to speak to the nature and extent of the adverse effects of Hg contamination.

Finally, EPA does not appear to contemplate any assessment of the distribution of the costs and benefits of the CAMR and more protective alternatives. However, as Professor O'Neill demonstrates, various subpopulations' different circumstances of exposure mean that the adverse effects of Hg reductions that are delayed and/ or diminished will not be distributed equally. Rather, the harms will be visited disproportionately on American Indian tribes and their members   especially those in the Great Lakes states, where there is a likelihood of " hot spots" under the EPA's proposed cap and trade approach   and on other communities of color and low income groups. Indeed, it is clear from the preamble to the proposed CAMR that the EPA is well aware of who it is that will be adversely affected by a more lenient rule. In order to fulfill its obligations under EO12898 regarding environmental justice   as well as its obligations under the federal trust responsibility, treaties, and various other legal doctrines   EPA must assess and address the distributive implications of its proposed rule.

Response:

EPA included four potentially high risk populations in the RIA, including: ( a) high end recreational fisher anglers ( with consumption rates at or above the 95th percentile for this group), ( b) economically disadvantaged high end consumers with poverty status income and fish consumption rates at or above the 95th percentile for freshwater anglers, ( c) Hmong in Minnesota and Wisconsin and ( d) Chippewa in Minnesota, Wisconsin and Michigan. These special population are intended to provide coverage for groups of individuals who through choice, necessity or socio cultural practices consume relatively high levels of self caught freshwater fish. Inclusion of these four special populations is also intended to support consideration of distributional/ equity in relation to EGU based environmental regulation ( i. e., would a subset of the US population benefit disproportionately from regulations to reduce mercury emissions from EGUs)?

Fish consumption rates for all four special populations have been developed based on peer reviewed survey data that are representative of the particular group of interest. In the case of the Chippewa, we have used a mean value obtained from the literature ( see RIA Chapter 10 9 260 for additional details). However, it was not possible to identify a high end percentile consumption rate based on peer reviewed literature and consequently, the mean consumption rate was used in the benefits analysis without consideration for variability in fish consumption rates across individuals. However, in response to information ( including that provided by this commentor), EPA has conducted a sensitivity analysis for high end fish consumption by the Chippewa population using ( a) the maximum delta fish tissue concentration modeled in the RIA for Option 1 and Option 2 for the Chippewa ( i. e., the maximum change in MeHg fish tissue concentrations modeled for the Chippewa under CAMR Options 1 and 2) and ( b) the maximum seasonal fish consumption rate provided in the NODA comments ( i. e., 393.8 g/ day). The results suggest that total IQ reductions under Option 1 and 2, even under these conservative assumptions ( i. e., highest change in mercury fish tissue concentrations under Option 1 and Option 2 and the highest seasonal fish consumption rate), are relatively low at 0.02 IQ points per child. This relatively low IQ benefit for this conservative scenario reflects the fact that, while states where the Chippewa are located may have relatively high absolute ( total) MeHg concentrations in target fish species, modeled EGU deposition over these areas is relatively low and consequently, CAMR is likely to produce smaller changes in mercury fish tissue concentrations compared with other areas where EGU deposition is higher. These findings argue against a distributional equity concern for the Chippewa in this portion of the study area ( although this conclusion needs to be considered in the context of the overall precision and specificity of the benefits model used in this RIA which is not intended for site specific analysis and was developed for application at the regional level).

EPA has used a cost of illness function based on lost earnings resulting from methylmercury exposure as the basis for its primary benefits estimate in the RIA ( i. e., prenatal methylmercury exposure through maternal consumption producing IQ decrements in children which translate into lost earnings later in life). This valuation function, which is based on the approach used in past EPA regulations concerning lead exposure, also considers the impact of lowered IQ on years of education achieved. EPA acknowledges that because this function is based on cost of illness and not willingness to pay ( WTP), it likely represents a lower bound for valuation of the IQ decrements and that a more comprehensive WTP based function would capture other factors such as those listed by the commentor above. Note, EPA did not use a WTP based function in the benefits analysis because peer reviewed literature does not support derivation of such a function at this time.

Comment:

One commenter ( OAR 2002 0056 5571) noted that EPA has requested comments as to how reductions in population level exposures of Hg will improve public health. ( Question 1) The commenter noted that it is important to understand that there is a threshold for Hg levels in the blood below which there are no effects. This is in contrast to lead, which appears to have no clear threshold level. Unlike lead a significant (> 50 percent) percentage of atmospheric Hg is from natural sources. Mercury has been present in fish tissue prior to the industrial revolution. EPA has selected an RfD for Hg in maternal blood ( 5.8 ppb) that serves as a de facto threshold. This number, which is 10 times below the threshold number developed from the Faroe Islands study 9 261 and 14 times lower than the WHO level of concern, is very conservative. This commenter believes that if an unrealistically low threshold ( ULT) for Hg blood levels were used to estimate benefits, reductions in blood levels between the true threshold and the ULT would create the appearance of a benefit where there is none.

EPA has requested comments as to the appropriateness of using IQ as an endpoint for both quantifying neurological development and the benefit analysis for reduced exposure to MeHg. In addition, EPA requested comments on the appropriateness of a linear dose response model evaluating health impacts. The commenter noted that there is a concern that EPA may wish to develop a relationship between Hg emissions and general population IQ. If this relationship were then coupled with an imputed value for increased IQ for the general population, large estimated benefits could be generated that would not exist, since there is no evidence of IQ impact at blood Hg levels greater than the RfD but below the Faroe Island threshold level. There are opportunities to calculate an imputed value for IQ changes, for example, recent work by Jones and Schneider estimates that a 1 point increase in national IQ is associated with a 0.16 percent annual increase in GNP. This commenter believes that there is also a concern that assuming a linear response between blood Hg and IQ would lead to an imputed benefit for reducing blood Hg below the threshold level, again creating benefits that do not exist.

Comment:

One commenter ( OAR 2002 0056 5571) notes that EPA's successful lead reduction program is not an appropriate model for Hg. Lead is a pollutant that has been linked to neurological damage similar to that of Hg. In the late 1970s, EPA initiated a successful program designed to eliminate all lead emissions into the environment primarily through the phase out of leaded gasoline. Since airborne lead emissions are linked to blood lead levels in children and related neurological impacts, it may appear reasonable to utilize the lead elimination model for dealing with Hg. However, there are important reasons why the program to reduce lead ( total elimination of air emissions) is not appropriate for dealing with Hg.

° Virtually all airborne lead is attributed to anthropogenic sources while a large percentage of airborne Hg (> 50 percent) is due to natural sources. It is impossible to eliminate all airborne Hg emissions.

° Lead emissions and ambient lead concentrations are primarily associated with urban areas while Hg emissions and ambient Hg concentration are global.

° While there appears to be no lower limit for neurological impacts for lead blood levels, Hg blood levels have a clear threshold below which there are no neurological impacts.

° While neurological impacts were clearly shown at blood lead levels present in urban US children in the 1970s, no such neurological impacts have been noted or documented at Hg blood levels currently found in American child bearing age women or children. 9 262 This commenter believes that EPA should consider the loss of health benefits associated with reduced fish consumption due to an overly conservative RID for Hg blood levels in determining net health benefits due to the CAMR. The vast majority of health studies have concluded that the benefits of fish consumption by all segments of the general population far outweigh any effects due to blood Hg levels greater than EPA's RID and at levels approaching the WHO level of concern. The use of the RID as the basis for calculating fish warning Hg levels has resulted in a reduction in fish consumption and the related loss of health benefits to the public. The commenter supports the comments of the Center for Science and Public Policy in this regard.

In conclusion, the commenter believes that the combination of ( 1) an overly conservative blood Hg threshold and a linear dose response with assumed benefits accruing below the threshold level along with ( 2) the failure to properly account for the loss of health benefits due to reduced fish consumption based on EPA's RID will produce unwarranted and unrealistically high estimated benefits from Hg emission reductions from the proposed CAMR.

Response:

As described in other responses, the Agency has high confidence in the RfD for methylmercury. EPA encourages the public to vary the species and sources of fish in order to obtain the benefits of fish consumption while avoiding elevated exposures to methylmercury. The fish advisory developed jointly with the Food and Drug Administration emphasizes the benefits of including fish in a healthy diet while informing the public on ways to reduce methylmercury exposure ( http:// www. epa. gov/ waterscience/ fishadvice/ advice. html).

Comment:

The commenter ( OAR 2002 0056 5455) also wished to comment on Step 5 of the NODA addressing cost/ benefit analyses and how Hg reduction will improve human health. The commenter found that EPA's benefits analysis did nothing to address the importance of fishing as a cultural practice. There was no way to place a dollar amount on the benefit to spiritual well being as a result of practicing a centuries old tradition and passing it on to our children. In a more concrete measurement, EPA did nothing to address replacing a subsistence food source that provided a significant amount of nutrition for the commenter's members. In making a local, easily obtainable food source inedible due to poisoning, EPA should calculate the costs that will be incurred in finding alternate sources of nutrition. The commenter was also unaware of any attempts EPA had made to quantify the costs of the learning and educational problems that exposed children may experience. For example, the loss in lifetime earnings resulting from lowered IQ's in the generalized population as a result of Hg poisoning has been estimated at $ 2.3 billion per year. By refusing to set adequate MACT standards, EPA was heaping most of this loss on the heads of native people. Another error in EPA's cost/ benefit analysis came from the projection of $ 15 billion in savings due to health related benefits from their proposed rule. These were simply health benefits that accrued from EPA's very substandard proposal. If a proper MACT standard were set in place, additional billions of dollars could be saved. 9 263 EPA had also failed to assess tourism related impacts. Tourism brought in $ 9.8 billion annually in Minnesota alone. Of this total, sport fishing enthusiasts spend $ 1.58 billion, or 16 percent. Although it was unknown to what level fish advisories impacted these number, fishing and tourism brought in income that the state of Minnesota could not afford to lose. The other Great Lakes states of Wisconsin, Michigan, Illinois, Indiana, and Ohio face similar situations. Together, these states, along with Minnesota, attract 7.8 million anglers annually who spend $ 5 billion in fishing related dollars. Although these are not directly health related issues, they certainly need to be addressed in EPA's economic considerations.

Response:

EPA has used a cost of illness function based on lost earnings resulting from methylmercury exposure as the basis for its primary benefits estimate in the RIA ( i. e., prenatal methylmercury exposure through maternal consumption producing IQ decrements in children which translate into lost earnings later in life). This valuation function, which is based on the approach used in past EPA regulations concerning lead exposure, also considers the impact of lowered IQ on years of education achieved. EPA acknowledges that because this function is based on cost of illness and not willingness to pay ( WTP), it likely represents a lower bound for valuation of the IQ decrements and that a more comprehensive WTP based function would capture other factors such as those listed by the commentor above. Note, EPA did not use a WTP based function in the benefits analysis because peer reviewed literature does not support derivation of such a function at this time.

Comment:

Four commenters ( OAR 2002 0056 2224,  2835,  2867,  2922) filed comments to supplement EPA's discussion of its statutory authority to regulate under CAA section 111 and to establish a cap and trade program. They stated that CAA section 111 confers broad legal authority for the regulation of existing sources under a Federal State partnership. The legislative history and the relationship between the plans developed for the State Federal partnerships under CAA section 110 and section 111 further supports EPA's determination that a flexible emissions trading program can be implemented under section 111( d).

The commenters noted that this partnership contemplates EPA establishing " standards of performance" at the national level and each state developing a regulatory program for implementing and enforcing those standards at the state level. The commenters pointed out that the statute explicitly notes that the Federal State partnership under CAA section 111( d) is to be modeled after the regulatory process used under CAA section 110. In that regulatory context, CAA section 110 provides States with wide latitude in developing emissions control strategies for achieving Federal air quality goals   National Ambient Air Quality Standards ( NAAQS) established by EPA at the national level.

Both the statute and legislative history confirm that Congress delegated broad legal authority to adopt flexible regulatory mechanisms for controlling existing sources under section 9 264 111( d)( 1). This broad delegation of authority provides sufficient authority for EPA to establish flexible " standards of performance" that need not prescribe when, how, and the degree to which each affected unit must achieve that emissions limitation   either on a unit by unit basis or facility by facility basis. In addition, the CAA authorizes States to implement and enforce those standards of performance through cap and trade program or other such flexible, market based mechanism that implements the reduction requirement imposed under the standard of performance, while taking into consideration " the remaining useful life" of the source as well as " other factors." EPA's proposed trading scheme is one effective mechanism for States to address concerns regarding existing units whose remaining useful life is limited such that the purchase of allowances may be appropriate in lieu of making additional major pollution control investments at those units. Commenter OAR 2002 0056 2835 described in detail how this interpretation is confirmed in the legislative history to CAA section 111( d).

Another indication of the broad discretion accorded to EPA and States in implementing and enforcing standards of performance under section 111 ( d)( 1) is the relationship that this section has with section 110. Section 111 ( d)( 1) requires EPA to promulgate regulations that establish SIP like procedures similar to those in section 110 to be used by States in submitting their plans. The CAA section 111( d) plans and SIP programs are complementary to one another   in particular, a State's plan under section 110 ( or section 172, for non attainment areas) can be used to meet the standards under section 111( d). States can thus use the SIP regulatory tools in CAA sections 110( a)( 2)( A) and 172( c)( 6) to establish " enforceable emissions limitations and other control measures" to achieve this end. One such regulatory tool available to States explicitly referenced under these sections is the adoption of " economic incentives such as fees, marketable permits, and auctions of emissions rights," when developing a plan to comply with the standards under section 111( d)( 1).

This complementary relationship was confirmed in EPA's guidance for implementing the Emission Guidelines for Municipal Waste Combustors established under CAA sections 111( d) and 129. EPA's guidance explained that where the SIP requirements are adequate to meet the section 111( d)/ 129 standard  which are required to be more rigorous than emission guidelines under only section 111( d)  the State has the authority to submit a section 111( d)/ 129 plan that relies on the requirements of the SIP to meet the section 111 ( d)/ 129 standard. The commenter adds that the section 111( d)/ 129 rule for Municipal Waste Combustors also clearly contemplated that States would use trading when implementing and enforcing the standards the rule explicitly provided that a state plan could " establish a program to allow owners or operators of municipal waste combustor plants to engage in trading of nitrogen oxides emission credits."

Commenter OAR 2002 0056 2867 stated that EPA has correctly harmonized these conflicting statutory provisions, and interpreted them in a way that effectuates the purposes of the statute as whole. The commenter agreed that the key provision in the definition of a " standard of performance" under CAA section 111 is the phrase " the best system of emissions reduction." Since this phrase is not defined by statute, EPA has broad discretion in determining what is the " best system of emissions reduction," so long as the system ultimately selected " has been adequately demonstrated." The commenter pointed out the definition places no other explicit 9 265 statutory constraints on EPA in making this determination, except that it must consider the following factors: the cost of achieving the Hg reductions, non air quality health and environmental impacts, and energy requirements. The commenter concluded that the statute requires the standards of performance be based on " the degree of emission limitation achievable" by the best system of emissions reduction system selected by EPA. As evidenced by the success of other cap and trade programs for the power sector, i. e., the NOx SIP Call and the Title IV Acid Rain Program, the trading program approach arguably satisfies the statutory requirement for setting the standard of performance based on the best system of emission reduction for the electric utility source category.

The commenter felt it is important to note that the statutory definition does not require specific units or facilities to install emissions control technology. In addition, the definition is silent on whether or not the standard of performance prescribing specific emissions limits should directly apply on a unit by unit or facility by facility basis. The commenter also noted that the definition is silent on whether each unit or facility must achieve specific reduction levels continuously or averaged over a specific period of time. ( Regarding this issue, the commenter pointed out that CAA section 302( 1) also contains a definition of the term " standard of performance," which defines the term to mean " a requirement of continuous emission reduction, including any requirement relating to the operation or maintenance of a source to assure continuous emissions reduction." It appears to the commenter that this definition would not be controlling for purposes of setting standards of performance under section 111, given that Congress chose to adopt another specific definition of standard of performance in CAA section 111.

Three commenters ( OAR 2002 0056 2224,  2835,  2867) emphasized that CAA section 111( d)( 1) itself does not independently mandate that standards of performance for existing sources impose a source specific requirement for continuous emission reduction. Thus, a State plan incorporating a standard of performance that employs a cap and trade mechanism would not conflict with the statutory requirements of section 111( d)( 1). However, a strong case can be made for the proposition that the emissions cap and allowance holding requirement in EPA's proposed section 111( d) trading program impose a " continuous emissions reduction" requirement on affected electric utility units. The proposed cap and trade program establishes a permanent cap on Hg emissions and requires affected sources to hold allowances that correspond to the level of Hg emissions from those sources at all times. By its very elements, the proposed cap and trade program is a continuous method of emission reduction given that there is no point in time when an affected source can emit Hg without holding allowances that correspond to those emissions. EPA's proposal also requires continuous emissions monitoring to assure that a source complies with the requirements of the cap and trade program at all times. Thus, if a court were ever to construe section 111( d)( 1) to require a " continuous emission reduction," the features of EPA's proposed trading program should meet that requirement.

The legislative history of the term " standard of performance," does not specifically reference an allowance trading system as a regulatory mechanism for controlling emissions under CAA section111( d), but generally reflects Congress' intent that existing sources be accorded 9 266 considerable flexibility in meeting the section 111( d) standards. Such legislative intent for compliance flexibility provides general support for EPA's interpretation that the term " standard of performance" may include an allowance trading program, as proposed in the Hg rule, because such a trading program accords flexibility to sources.

According to the commenter, the Senate debate on the 1990 amendments reinforces this statutory interpretation, in light of Congress' express action removing any specific percent reduction requirement from the concept of " standards of performance." As an example, the commenter states that Senator Baucus explains that Congress adopted a percentage reduction requirement in the 1977 CAA Amendments to ensure that coal fired electric generating units did not rely on low sulfur " compliance" coal alone to meet NSPS for SO2. According to Senator Baucus, a percentage reduction requirement across the board was supposed to require SO2 scrubbers regardless of the rank of coal combusted; however, this approach accentuated the regional split over coal use that existed prior to 1977. With the adoption of the SO2 emissions cap under the Title IV acid rain program, the percentage reduction requirement was no longer necessary and could in fact be a barrier to flexible compliance under the acid rain trading program. The commenter continues that accordingly, Congress elected to repeal the percent reduction requirement during the 1990 CAA Amendments.

The commenter also referenced remarks in debate by Senator Bond during the 1990 CAA Amendments that also pertain to the removal of the percentage reduction requirement and, indirectly, the continuous emission reduction requirement. Specifically, Senator Bond explained that both the House and the Senate rejected the concept of the percentage reduction and " directed EPA to come up with an alternative standard that would allow utilities to meet it in the most flexible manner possible." Senator Bond further noted that the new standards could be met by fuel switching, the use of technology and fuel switching, by technology alone, and by intermittent controls or intermittent operation. Senator Bond continued by stating that "[ t] he way the language is constructed, intermittent controls can be allowed to comply with this section of the act. So for the first time in 13 years we will have EPA setting. . . emission levels for SO2 that will not require the use of the scrubbers for compliance."

The commenter stated that this flexibility was not intended to be limited to utility standards, or the operation of the Acid Rain Program, but was to be afforded to all sources subject to " standards of performance" under section 111. The commenter felt it would be ironic if EPA failed to take advantage of the flexibility specifically intended by Congress to benefit the utility industry in the context of developing requirements for Hg control, since EPA itself has not identified any particular control technology as the basis for its standards.

Response:

Section 111( d)( 1) authorizes EPA to promulgate regulations that establish a State Implementation Plan like ( SIP like) procedure under which each State submits to EPA a plan that, under subparagraph ( A), " establishes standards of performance for any existing source" for certain air pollutants, and which, under subparagraph ( B), " provides for the implementation 9 267 and enforcement of such standards of performance." Paragraph ( 1) continues, " Regulations of the Administrator under this paragraph shall permit the State in applying a standard of performance to any particular source under a plan submitted under this paragraph to take into consideration, among other factors, the remaining useful life of the existing source to which such standard applies."

Section 111( a) defines, "( f) or purposes of... section ( 111)," the term " standard of performance" to mean a standard for emissions of air pollutants which reflects the degree of emission limitation achievable through the application of the best system of emission reduction which ( taking into account the cost of achieving such reduction and any non air quality health and environmental impact and energy requirements) the Administrator determines has been adequately demonstrated.

Taken together, these provisions authorize EPA to promulgate a " standard of performance" that States must, through a SIP like system, apply to existing sources. A " standard of performance" is defined as a rule that reflects emission limits to the degree achievable through " the best system of emission reduction" that EPA " determines has been adequately demonstrated," considering costs and other factors.

A cap and trade program reduces the overall amount of emissions by ( i) requiring sources to hold allowances to cover their emissions on a one for one basis; ( ii) limiting overall allowances so that they cannot exceed specified levels ( the " cap"); and ( iii) reducing the cap to less than the amount of emissions actually emitted, or allowed to be emitted, at the start of the program. In addition, the cap may be reduced further over time. Authorizing the allowances to be traded maximizes the cost effectiveness of the emissions reductions in accordance with market forces. Sources have an incentive to endeavor to reduce their emissions cost effectively; if they can reduce emissions below the number of allowances they receive, they may then sell their excess allowances on the open market. On the other hand, sources have an incentive to not put on controls that cost more than the allowances they may buy on the open market.

The term " standard of performance" is not explicitly defined to include or exclude an emissions cap and allowance trading program. In today's action, EPA finalizes its proposal to interpret the term " standard of performance," as applied to existing sources, to include a capand trade program.

Because Congress did not speak precisely to this issue, EPA's interpretation of the term to authorize a cap and trade program is entitled to deference and should be upheld by a Court because the interpretation is reasonable. Chevron, U. S. A., Inc. v. Natural Resources Defense Council, Inc., 467 U. S. 837, 842 73 ( 1984). This interpretation is supported by a careful reading of the section 111( a) definition of the term, quoted above.

In the phrase, " standard of performance," the first operative term is " standard" and the 1 The legislative history of the term, " standard of performance," does not address an allowance/ trading system, but does indicate that Congress intended that existing sources be accorded flexibility in meeting the standards. See " Clean Air Act Amendments of 1977," Committee on Interstate and Foreign Commerce, H. R. Rep. No. 95 294 at 195, reprinted in 4 " A Legislative History of the Clean Air Act Amendments of 1977," Congressional Research Service, 2662. Because Congress intended flexibility for existing sources, EPA interprets this legislative history as generally supportive of interpreting " standard of performance" to include an allowance/ trading program because such a program accords flexibility to sources. The legislative history contains no direct indication that Congress intended to preclude EPA from implementing section 111 for existing sources through a cap and trade program.

9 268 standard must be " for emissions of air pollutants." The ordinary definition of " standard" is "[ a] n accepted measure of comparison for quantitative or qualitative value," or " criterion." Webster's II New Riverside University Dictionary 1131 ( 1984). Under the cap and trade requirement, each existing source is obligated to hold an allowance for each unit of mercury that it emits. This requirement to hold allowances sufficient to cover emissions meets the definition of the term, " standard" because the requirement constitutes a means of measurement, or a type of a criterion, " for emissions of air pollutants." That is, the measure or criterion for a source's emissions of air pollutants is the amount of allowances that the source holds.

A cap and trade program is also consistent with the remaining components of the term " standard of performance," that is, the " standard for emissions of air pollutants" must be one ( i) " which reflects the degree of emission limitation achievable" ( i. e., which requires an amount of emissions reductions that can be achieved), ( ii) " through the application of the best system of emission reduction which ( taking into account the cost of achieving such reduction and any nonair quality health and environmental impact and energy requirements) the Administrator determines has been adequately demonstrated." 111 The key component of the last part of this definition is the phrase, " best system of emission reduction." While the parenthetical following this phrase obligates EPA to consider the factors specified in that parenthetical, the term " best system" itself is not defined, and implicitly accords broad discretion to the Administrator. The term " system" implies a broad set of emissions reductions, and the term " best" confers upon the Administrator the authority to promulgate regulations requiring a system that he or she considers superior. The parenthetical phrase in the definition mandates consideration of certain factors, but the definition does not indicate how to weight those factors, how specifically to apply them, or whether other factors may be considered. Nor does the provision provide any other explicit constraints in determining the " best system." This broad authority conferred on the Administrator supports the view that the Administrator is authorized to interpret a cap and trade program as, under the present circumstances, the " best system," and thus as authorized under section 111( a) and ( d).

Nor do any other provisions of section 111( d) indicate that the term " standard of performance" may not be defined to include a cap and trade program. Section 111( d)( 1)( B) refers to the " implementation and enforcement of such standards of performance," and section 111( d)( 1) refers to the State " in applying a standard of performance to any particular source," 2 This interpretation of the term " continuous" is consistent with the legislative history of that term. See H. R. Rep. No. 95 294 at 92, reprinted in 4 Congressional Research Service, A Legislative History of the Clean Air Act Amendments of 1977, 2559.

9 269 but all of these references readily accommodate a cap and trade program.

Although section 111( a) defines " standard of performance" for purposes of section 111, section 302( l) defines the same term, "( w) hen used in this Act," to mean " a requirement of continuous emission reduction, including any requirement relating to the operation or maintenance of a source to assure continuous emission reduction." The term " continuous" is not defined in the CAA.

Because section 111( a) defines " standard of performance" for purposes of section 111, EPA believes that the section 302( l) definition does not apply to section 111. However, even if the section 302( l) definition applied to the term " standard of performance" as used in section 111( d)( 1), EPA believes that a cap and trade program meets the definition. A cap and trade program with an overall cap set below current emissions is a " requirement of... emission reduction." Moreover, it is a requirement of " continuous" emissions reductions because all of a source's emissions must be covered by allowances sufficient to cover those emissions. That is, there is never a time when sources may emit without needing allowances to cover those emissions. 22 We note that EPA has on one prior occasion authorized emissions trading under section 111( d). ( The Emission Guidelines and Compliance Times for Large Municipal Waste Combustors that are Constructed on or Before September 20, 1994; 40 CFR Part 60, subpart Cb.) This provision allows for a NOx trading program implemented by individual States. Section 60.33b( C)( 2) states,

A State plan may establish a program to allow owners or operators of municipal waste combustor plants to engage in trading of nitrogen oxides emission credits. A trading program must be approved by the Administrator before implementation.

Today's proposal is wholly consistent with this prior section 111( d) trading provision.

Having interpreted the term " standard of performance" to include a cap and trade program, EPA must next " determine" that such a system is " the best system of emissions reductions which ( taking into account the cost of achieving such reduction and any non air quality health and environmental impact and energy requirements)... has been adequately demonstrated." Section 111( a)( 1). EPA has determined that a cap and trade program based on control technology available in the relevant time frame is the best system for reducing Hg emissions from existing coal fired Utility Units.

Since the passage of the 1990 Amendments to the CAA, EPA has had significant 3 Non electricity generating units are also included in the States' programs.

9 270 experience with the cap and trade program for utilities. The 1990 Amendments provided, in Title IV, for the acid rain program, a national cap and trade program that covers SO2 emissions from utilities. Title IV requires sources to hold allowances for each ton of SO2 emissions, on a one for one basis. EPA allocates the allowances for annual periods, in amounts initially determined by the statute, that decrease further at a statutorily specified time. This program has resulted in an annual reduction in SO2 emissions from utilities from 15.9 million tons in 1990 ( the year the Amendments were enacted) to 10.6 million tons in 2003 ( the most recent year for which data was available). Emissions in 2003 were 41 percent lower than 1980, despite a significant increase in electrical generation. At full implementation after 2010, emissions will be limited to 8.95 million tons, a 50 percent reduction from 1980 levels. The Acid Rain program allowed sources to trade allowances, thereby maximizing overall cost effectiveness.

In addition, in the 1998 NOx SIP Call rulemaking, EPA promulgated a NOx reduction requirement that affects 21 States and the District of Columbia (" Finding of Significant Contribution and Rulemaking for Certain States in the Ozone Transport Assessment Group Region for Purposes of Reducing Regional Transport of Ozone; Rule," 63 FR 57,356 ( October 27, 1998)). All of the affected jurisdictions are implementing the requirements through a capand trade program for NOx emissions primarily from utilities. 33 These programs are contained in SIP that EPA has approved; and EPA is administering the trading programs. However, for most States, the requirements did not need to be implemented until May, 2004.

Further, EPA recently promulgated the Clean Air Implementation Rule ( CAIR), which requires SIP revisions in 28 States and the District of Columbia to reduce emissions of SO2 and or Nox because those emissions contribute significantly to attainment problems for the PM2.5 or 8 hour ozone national ambient air quality standards in downwind States. The EPA Administrator signed the CAIR on March 10, 2005, and the rule and associated documents are available at http:// www. epa. gov/ cair/ rule. html. Like the Nox SIP Call, in CAIR, EPA authorizes, and fully expects, the States to comply with the emissions reduction requirements through implementation of a cap and trade program.

The success of the Acid Rain and Nox SIP Call cap and trade programs for utility SO2 and Nox emissions, respectively, which EPA duplicated in large measure with the CAIR capand trade programs, leads EPA to conclude that a cap and trade program for Hg emissions from utilities qualifies as the " best system of emission reductions" that " has been adequately demonstrated." A market system that employs a fixed tonnage limitation ( or cap) for Hg sources from the power sector provides the greatest certainty that a specific level of emissions will be attained and maintained because a predetermined level of reductions is ensured. The EPA will administer a Hg trading program and will require the use of monitoring to allow both EPA and sources to track progress, ensure compliance, and provide credibility to the trading component of the program. The benefits of the cap and trade program are further described elsewhere in today's notice and in the separate Federal Register notice announcing EPA's revision of its 9 271 December 2000 regulatory determination and removing Utility Units from the 112( c) list of categories.

EPA agrees that section 111( d), by relying on the Federal state partnership, appears to incorporate the flexibility in type of acceptable State plan that is acceptable for purposes of section 110. The acceptability of cap and trade programs for section 110 SIP planning purposes suggests that they should be acceptable for section 111( d) state planning purposes.

EPA agrees that the statutory provisions that define " standard of performance" are silent on whether such standard applies on a unit by unit, facility by facility, or other basis; and are silent on whether the regulated entity must achieve specific reductions levels continuously, on an average basis, or on some other basis. Because the provisions are silent, EPA has authority to apply a reasonable interpretation, and EPA considers the cap and trade program to be reasonable.

EPA further agrees that no provision of section 111( d) by its terms, nor any statements in the accompanying legislative history, suggest that a technological requirement, or any other specific requirement that is in the nature of a command and control requirement, must apply to each individual existing unit. EPA further agrees that statements in the legislative history emphasize the flexibility that States were to be accorded in fashioning plans for individual sources or groups of sources. H. R. Rep. No. 95 294 at 195, reprinted in Legislative History of the Clean Air Act Amendments of 1977 at 2662 ( each state is to develop a " plan" that should " be based on the best available means ( not necessarily technological) for categories of existing sources to reduce emissions;" EPA is to " establish guidelines as to what the best system is for each [ category of sources];" states " are responsible for determining the applicability of [ the] guidelines to any particular source or sources").

EPA further agrees that a cap and trade program is a mechanism for taking into account remaining useful life of the existing sources because it offers existing sources the opportunity to comply with requirements through the purchase of allowances, and that the consistency of a capand trade program with the section 111( d) requirements lends further support for the reasonableness of interpreting the term " standard of performance" to authorize a cap and trade program.

EPA further agrees that statements in the 1990 legislative history describing the repeal of the percentage reduction requirements as designed to enhance flexibility offer further support for EPA's interpretation of section 111( d) to allow a cap and trade program. E. g., Senate Debate on the Clean Air Act Amendments of 1990 Conference Report, reprinted in 1 Legislative History of the Clean Air Act Amendments of 1990, at 1149 ( statement of Sen. Simpson).

Comment Four commenters ( OAR 2002 0056 2359,  2823,  2920,  3459) contended that even if the regulation of HAP were available under 111( d), EPA's proposal under section 111( d) is not 9 272 an adequate substitute for section 112 regulation. EPA acted arbitrarily and capriciously in implying that section 111 regulation, including a cap and trade approach, is adequate to address the harmful regional and local health and ecological impacts of HAP emissions from power plants ( 2823).

Response EPA disagrees with commenters' view that the Title IV and Nox SIP Call programs do not provide useful precedent for a cap and trade program because, according to commenters those programs operated against a backdrop of other requirements for local controls, including SIP measures, NSPS provisions, and NSR requirements. EPA believes that the commenters are incorrect because many existing sources subject to Title IV or the Nox SIP Call are not subject to other control requirements ( because, for example, they were in existence before the promulgation of otherwise applicable NSPS rules, they are in attainment areas and thereby avoid nonattainment SIP requirements, and they have not taken actions that would subject themselves to PSD requirements). In any event, the utility of the Title IV and Nox SIP Call programs is that they demonstrated that their cap and trade programs succeeded in costeffective achieving reductions . EPA acknowledges commenters' views that in some instances, the cap and trade program may be associated with increased emissions, or, at least, emissions levels that stay constant, in a particular location or state. EPA modeled the effect of the cap and trade program on mercury emissions. The section 112 revision notice and accompanying documents describe the results, including the lack of " hot spots."

Comment:

One commenter ( OAR 2002 0056 5570), responded to EPA's request for more information on the types of fish Americans eat and the concentrations of Hg found in these fish, the location where these fish are caught, and the types, amounts, location and Hg levels in fish consumed by highly exposed populations, the commenter would like to reiterate their previous point that relevant analysis has already been done and that EPA should utilize their own existing estimates for fish consumption patterns and vulnerable populations. Most notably, in preparation for the new joint EPA/ FDA advisory on Hg in fish, both Agencies undertook an evaluation of consumption patterns, locations and vulnerable populations. In addition, external partners including a number of states and environmental and public health organizations have also tracked such data. Across all of these analyses, there is broad consensus about the pervasiveness of Hg contamination, and the high number of states with fish advisories for Hg.

In addition, the commenter would like to affirm EPA's apparent intent to look at susceptible populations ( i. e., the tails of the fish consumption distribution, not just the average) to ensure that all Americans are adequately protected.

Response: 9 273 EPA appreciates the input from the commenter. We have carefully studied fish consumption patterns and our analysis is presented in the RIA and in the Effectiveness TSD.

Comment:

One commenter ( OAR 2002 0056 5477) stated that recent scientific studies have confirmed the serious health risks to the developing fetus from MeHg exposure. In addition, recent studies confirm that a greater amount of MeHg is distributed to the fetus than previously estimated, leading to a doubling of an earlier annual estimate of newborn infants at risk in the U. S. from 300,000 to 600,000. In the Northeast, the prospect of over 84,000 newborns per year potentially at risk for irreversible neurological deficits and cardiovascular abnormalities from MeHg exposure represents one of the most critical public health threats in our region today.

Over 15,000 fish samples collected in the Northeast region confirm widespread Hg contamination of our aquatic ecosystems, irreparably threatening human health and wildlife unless actions are taken to reduce significant sources of Hg emissions. All Northeast states have issued fish consumption advisories because of Hg contamination. In addition to the toll on human health and wildlife, Hg contamination also threatens the tourist and recreational fishing industries, which contribute $ 3 billion a year to our regional economy.

Recent scientific field studies have shown that reductions in Hg emissions lead to reductions in the Hg concentrations in fish tissue. After several years of implementing effective regulations to control Hg emissions from municipal waste combustors, medical waste incinerators, and other sources in the Northeast, the electric utility steam generating units ( EGUs) remain the largest uncontrolled source category of Hg and other hazardous air pollutant ( HAP) emissions in the region. Further, transported Hg emissions from out of region coal fired EGUs are a major contributor to Hg deposition in the Northeast. In view of the public health and environmental impacts associated with exposure to Hg and other hazardous pollutants, the commenter believed it was extremely important that the EPA take swift and aggressive steps to reduce emissions of these pollutants from EGUs burning coal and oil.

Response:

We have carefully studied fish consumption patterns and our analysis is presented in the RIA and in the Effectiveness TSD.

Comment:

One commenter ( OAR 2002 0056 5464) stated that another portion of the NODA on which EPA has requested comments is its proposed revised benefits analysis. The commenter reiterated that Section 112( d) is clear about the fact that MACT should be a technology based approach, with requirements no less stringent than what well controlled sources are accomplishing ( i. e., " the average emission limitation achieved by the best performing 12 percent of the existing sources" or " the emission control that is achieved in practice by the best controlled 9 274 similar source"). Congress did not intend MACT to be based on risk assessment or cost benefit. However, to the extent that EPA could establish a more stringent MACT beyond the floor and may consider cost benefit in doing so, the commenter offered several comments to improve the benefits analysis.

The commenter was concerned that EPA's earlier benefits analysis calculated costs relative only to reductions in emissions of fine particulate matter ( PM2.5) and focused on only certain health effects. It did not include a comprehensive list of PM2.5 related health effects, nor did it cover health effects related to Hg, other HAPs, ozone, sulfur dioxide, nitrogen oxides or welfare effects related to Hg, PM, ozone, nitrogen and sulfate deposition. While they were pleased that EPA plans to expand its benefits analysis to include some of the health effects related to Hg, they did not believe it will go far enough. For example, the benefits analysis will include studies related to the effects of Hg exposure on IQ, but it will not adequately consider the cardiovascular health effects. There are emerging data and well developed studies showing an increase in death from heart attacks in men following Hg exposure. Furthermore, in considering IQ, EPA's analysis examines only decreased income resulting from lowered IQ and does not consider costs related to therapy, tutoring, special education and other remedial efforts.

Due to the commenter's concern that even the revised benefits analysis will underestimate the benefits of Hg reduction programs, they recommend that the benefits analysis be much more comprehensive and inclusive. Where quantitative data related to benefits are not available, the multiple benefits of additional Hg controls should be evaluated qualitatively and given weight in determining MACT limits that are more stringent than the MACT floor.

The commenter was concerned that the proposed definition of a hot spot indicates that the plant must cause exposures above the RID and believed this was inadequate. As suggested by the National Academy of Sciences panel that considered the health effects of MeHg, and further supported by more recent research, the dose response to Hg appears to be linear and effects have been reported at doses below the RID. It seems, therefore, that the definition of " hot spot" should not rely upon the RID.

Given the uncertainty that EPA has admitted relative to its modeling, the commenter felt the agency could not offer assurances about its calculations of the contributions of individual plants. When added to questions about health effects below the current RID, the commenter believed EPA's definition of hot spots in the proposal is inappropriate and does not protect public health.

Response:

EPA appreciates the input. Please see the RIA.

Comment:

One commenter ( OAR 2002 0056 5422) noted that EPA has requested comments as to 9 275 how reductions in population level exposures of Hg will improve public health. The commenter stated that it was important to understand that there is a threshold for Hg levels in the blood below which there are no effects. This is in contrast to lead, which appears to have no clear threshold level. Unlike lead a significant (> 50 percent) percentage of atmospheric Hg is from natural sources. Mercury has been present in fish tissue prior to the industrial revolution. EPA has selected an RfD for Hg in maternal blood ( 5.8 ppb) that serves as a de facto threshold. This number, which is 10 times below the threshold number developed from the Faroe Islands study and 14 times lower than the WHO level of concern, is very conservative. If an unrealistically low threshold ( ULT) for Hg blood levels were used to estimate benefits, reductions in blood levels between the true threshold and the ULT would create the appearance of a benefit where there is none.

EPA has requested comments as to the appropriateness of using IQ as an endpoint for both quantifying neurological development and the benefit analysis for reduced exposure to MeHg. In addition, EPA requested comments on the appropriateness of a linear dose response model evaluating health impacts. There is a concern that EPA may wish to develop a relationship between Hg emissions and general population IQ. If this relationship were then coupled with an imputed value for increased IQ for the general population, large estimated benefits could be generated that would not exist, since there is no evidence of IQ impact at blood Hg levels greater than the RfD but below the Faroe Island threshold level. There are opportunities to calculate an imputed value for IQ changes, for example, recent work by Jones and Schneider estimates that a 1 point increase in national IQ is associated with a 0.16 percent annual increase in GNP. There is also a concern that assuming a linear response between blood Hg and IQ would lead to an imputed benefit for reducing blood Hg below the threshold level, again creating benefits that do not exist.

EPA's successful lead reduction program is not an appropriate model for Hg. Lead is a pollutant that has been linked to neurological damage similar to that of Hg. In the late 1970s, EPA initiated a successful program designed to eliminate all lead emissions into the environment primarily through the phase out of leaded gasoline. Since airborne lead emissions are linked to blood lead levels in children and related neurological impacts, it may appear reasonable to utilize the lead elimination model for dealing with Hg. However, there are important reasons why the program to reduce lead ( total elimination of air emissions) is not appropriate for dealing with Hg.

° Virtually all airborne lead is attributed to anthropogenic sources while a large percentage of airborne Hg (> 50 percent) is due to natural sources. It is impossible to eliminate all airborne Hg emissions.

° Lead emissions and ambient lead concentrations are primarily associated with urban areas while Hg emissions and ambient Hg concentration are global.

° While there appears to be no lower limit for neurological impacts for lead blood levels, Hg blood levels have a clear threshold below which there are no neurological impacts. 9 276 ° While neurological impacts were clearly shown at blood lead levels present in urban US children in the 1970s, no such neurological impacts have been noted or documented at Hg blood levels currently found in American child bearing age women or children.

Response:

EPA appreciates the input. Please see the RIA.

Comment:

One commenter ( OAR 2002 0056 5477) stated that in its NODA, EPA notes that it had included a benefits assessment in its earlier proposed CAMR. The commenter would like to note that EPA's benefits assessment was inadequate for the important issue of establishing " Beyond the floor MACT." EPA goes on to state that it has " preliminarily revised its proposed approach to analyzing the benefits associated with Hg emission reductions from power plants." In our earlier comments, the commenter did not propose a methodology for benefits assessment. Since then the commenter ha completed an extensive and comprehensive draft report " Estimating Reductions in U. S. Mercury Exposures from Decreased Power Plant Emissions and the Associated Economic Benefit," that is undergoing an intensive peer review. The extensive scientific work that forms the basis of this report was undertaken by the commenter with Harvard Center for Risk Analysis ( HCRA), part of the Harvard School of Public Health ( HSPH).

The report was prepared by Glenn Rice of HSPH as part of his doctoral work under the direction of Dr. James Hammitt, Director, Harvard Center for Risk Analysis. The report covers diverse areas of research, including: Hg emissions from sources, atmospheric transport and fate of Hg, atmospheric modeling and estimation of Hg deposition, relationship between Hg deposition and MeHg levels in fish ( and how they change with changes in emissions), current and future exposures of humans to Hg in fish, dose response functions, and finally, the monetization of the benefits related to reduced Hg emissions from coal fired power plants. The report evaluates these effects in four sequential tasks:

Task 1: Estimation of the effect of a specified reduction in power plant emissions of Hg on changes in regional Hg deposition and the resulting concentrations of MeHg in fish.

Task 2: Estimation of the effect of changes in MeHg concentrations in fish on human uptake.

Task 3: Estimation of the effect of changes in human uptake on the incidence of adverse human health effects.

Task 4: Quantification of the " monetized" value of the change in incidence of health effects.

Some of the benefits of controlling Hg are monetized for two Hg control scenarios. These 9 277 are based on Clear Skies Initiative ( CSI) Phase I, 2010 ( 26 TPY cap) and Phase II, 2020 ( 15 TPY cap). The Hg deposition levels for the base case ( 2001), as well as two pairs of base case/ control case scenarios ( Phase I and Phase II) were developed by the EPA using the REMSAD model as part of the Agency's analysis of the Clear Skies Initiative. The commenter's analysis estimated two sets of monetized benefits ( for Scenario 1 and Scenario 2) which are based on comparing the control case and base case deposition levels for CSI Phase I and for Phase II. The Hg emission estimates for the base case as well as for four future scenarios were also provided by EPA, based on IPM outputs.

The commenter's analysis evaluated the effect of changes in Hg emissions assuming no changes in the population or dietary patterns of U. S. residents. For this reason, the results are best interpreted as an estimate of the benefits of lower Hg emissions in a steady state world with population and fish consumption patterns similar to current conditions. To estimate the benefits of reduced Hg emissions in future years would require projecting changes in human population, fish harvesting and consumption, the temporal relationship between changes in Hg emissions from power plants and levels of MeHg in fish, and other factors.

To account for the effects of changes in Hg deposition on MeHg levels in fish, the U. S. landmass was divided into five regions ( West, Midwest, Mid Atlantic, Southeast, and Northeast). Additionally, the surrounding waters were studied as three regions for commercial and non commercial fish ( Gulf, Atlantic, and " all other marine waters."). Estimates of human uptake of MeHg through fish consumption are based on regional patterns of consumption of fish species, both commercial and non commercial.

The report integrates the avoided costs ( or " benefits") for two endpoints associated with a reduction in the neurological effects that result from intrauterine MeHg exposures and with reductions in adult fatal and non fatal cardiovascular ( myocardial) events related to adult MeHg exposures. The effects of MeHg intake on myocardial events are less certain than the effects on neurological events. The neurological benefits were valued using a cost of illness model based on IQ point gains that could result from decreased MeHg exposures. The non fatal myocardial events were valued using a cost of illness approach. The premature mortality events were valued using a willingness to pay or value of statistical life approach.

These neurological effects and the fatal and non fatal cardiovascular effects likely account for a large fraction of the total monetary value of damage to humans that is associated with MeHg exposures. The study also discusses two additional effects that have been observed in children and associated with intrauterine MeHg exposures: increased blood pressure and decreased heart rate variability. However, the study does not quantify these risks, because the increased blood pressure does not appear to persist and the clinical significance of changes in heart rate variability of otherwise healthy children is not known.

Based on the preliminary results of the detailed analysis, benefits for Scenario 1 ( 26 TPY cap) associated with improved IQ range from $ 64 million ( assuming a neurotoxicity threshold equal to the RfD) to $ 160 million ( assuming no threshold). The corresponding benefits for 9 278 Scenario 2 ( 15 TPY cap) are $ 93 million to $ 230 million. Much larger benefits are associated with avoided cardiovascular events ( fatal and non fatal). For Scenario 1, the monetized benefits are $ 2.7 billion. The corresponding benefits for Scenario 2 are $ 3.8 billion. All of these monetized benefits are per year. The total annual benefits for the two endpoints studied range from $ 2.8 billion for Scenario 1 to just over $ 4 billion for Scenario 2.

It is important to note that there is considerable uncertainty in the analysis and this includes a difference in the degree of confidence in the underlying studies for MeHg neurotoxicity ( based on the various " islands" studies) and the studies related to effects of MeHg on the cardiovascular system. The neurological effects associated with in utero MeHg exposures are well documented and have been thoroughly evaluated by a number of research and advisory groups ( e. g., National Research Council, 2000). However, the current published literature providing evidence for evaluating the association between cardiovascular events with adult MeHg exposures is substantially smaller and more recent than that for the neurotoxic events.

It is also important to note that the commenter's study did not evaluate monetized benefits associated with EPA's proposed MACT approach under Section 112 or EPA's preferred approach of performance standards under Section 111 of the Clean Air Act or other more stringent and technologically feasible control levels ( for example, less stringent of 90 percent control ( from Hg in coal) or 0.6 lb/ TBTU, as proposed by the States Stakeholders, ( see Appendix A, Page 10 16, see OAR 2002 0056 5477) since EPA did not undertake modeling of these scenarios with IPM and REMSAD/ CMAQ modeling. However, it should be obvious to EPA that monetized benefits would be substantially higher for the proposal offered by the States Stakeholders for only a small increase in costs ( based on application of extremely cost effective and commercially available technologies such as ACI). Thus, The commenter stood by their previous comments in support of a 90 percent reduction in Hg emissions from coal fired EGUs.

Response:

EPA appreciates the commenters input. Due to the summary nature of the information provided, EPA was not able to fully evaluate the analysis and its inputs and therefore was not in a position to incorporate the analysis summary or conclusions.

Comment:

One commenter ( OAR 2002 0056 5423) points out that, as shown in comment ( O), EPA's premise for negative child neurodevelopment is based essentially on one endpoint from the Faroe Island study that is representative of exposure to a cocktail of toxic chemicals like PCBs, DDT and MeHg rather than MeHg alone as demanded by EPA's CAMR power plant emission controls. This commenter suggests that EPA's claim for health " benefits" from its CAMR is hypothetical or almost impossible to demonstrate because the suggested health concerns were drawn on either flawed or irrelevant epidemiological data.

In direct contrast to claims of health concerns from consuming fish with trace amounts of 9 279 MeHg, this commenter offers findings from recent scientific studies supporting claims of significant children health related benefits derived through adequate consumption of fish or fish oil containing omega 3 polyunsaturated fatty acids.

Helland et. al., ( 2003, Pediatrics, vol. 111, e39 e44) recently stated that:

" Pregnant women [ of Oslo, Norway] were recruited in week 18 of pregnancy to take 10 mL of cod liver oil [ with about 2g of DHA+ EPA] or corn oil until 3 months after delivery [ in a randomized and double blinded study]. Children who were born to mothers who had taken cod liver oil ( n= 48) during pregnancy and lactation scored higher [ by 4 points] on the Mental Processing Composite of the K ABC [ Kaufman Assessment Battery for Children] at 4 years of age as compared with children whose mothers had taken corn oil. This study indicates that maternal supplementation with very long chain n 3 PUFAs during pregnancy and lactation improves the intelligence of children at 4 years of age."

Daniels et al. ( 2004, Epidemiology, 15,394 402) found that:

" Fish intake by mother during pregnancy and by the infant postnatally, was associated with higher mean [ child] development scores [ in a cohort of 7421 British children]. For example, the adjusted mean MacArthur [ vocabulary] comprehension score for children [ 15 months old] whose mothers consumed fish four or more times per week was 72 compared with 68 among those whose mothers did not consume fish. Although total cord mercury levels increased with maternal fish intake, our data did not suggest adverse developmental effects associated with mercury. In a small study of subjects in [ this] ALSPAC study, maternal DHA levels were associated with improved visual stereo acuity among offspring at 3.5 years of age. Fish intake during pregnancy has the potential to improve fetal development because it is a good source of iron and long chain omega fatty acids, which are necessary for proper development and function of the nervous system."

Finally, in another new study, Smuts et al. ( 2003, Obstetrics and Gynecology, vol. 101,469 479) explains:

"[ Our] study was a randomized, double blind, controlled, clinical trial to determine the effects of increasing docosahexaenoic [ DHA] acid intake during the third trimester of pregnancy on pregnancy and birth outcomes. Subjects were supplied with [ DHA] enriched eggs ( mean of 133 mg of [ DHA] per egg) or ordinary eggs ( mean of 33 mg of [ DHA] per egg). Eighty three percent of subjects completed the study ( 291 of 350 enrolled). No subject was discontinued for an adverse event. No safety concerns were raised by the study. The current study found a 6 day longer period of gestation when [ DHA] intake was increased ... Olsen et al. suggested that higher [ DHA+ EPA] intake from fish by Faroe Islanders compared 9 280 with Danes was the reason for longer gestation in Faroe Islanders. The authors subsequently demonstrated increases in gestation of 4 and 8.5 days, respectively, in randomized clinical trials that provided 2.7 g per day of [ DHA+ EPA] to a group of healthy pregnant women and to healthy pregnant women with a previous pre term delivery."

The commenter notes that claims of concern for fetal and child health by EPA and Hg activists appear disingenuous because they largely failed to emphasize to the public the benefits of fish consumption. This activism could unnecessarily terrorize expectant mothers into not eating a food that promotes better fetal development and child health.

Premature birth is a striking example. So serious is this outcome that the March of Dimes organization has adopted it as a primary cause. More than 470,000 babies are born prematurely every year in the U. S. These infants aren't just small; they're developmentally " unfinished."

The March of Dimes provides these facts on prematurely born babies:

° Has increased by 29 percent since 1981 ° Accounts for 12 percent of all live births ° Can happen to any pregnant woman ° Is the leading killer of babies in their first month of life ° Is a major cause of long term health problems, including cerebral palsy, mental retardation, blindness, chronic lung problems, Respiratory distress syndrome and bleeding in the brain ° Is the number one obstetrical problem in the country ° Robs families of the full potential of their children, society of their future leaders and our nation of strong and healthy citizens ° Places tremendous financial burdens on everyone. Hospital charges for infants with a principle diagnosis of prematurely average $ 75,000, and add up to billions of dollars each year.

Recognizing the role of fish nutrition plays in helping prevent the tragedy of premature births, the March of Dimes is funding a Danish and Chinese research team to further clarify the issue. One of the researchers, Dr. Sjurdur Olsen of Denmark reported that Danish women who consumed fish or seafood at least once a week during the first 16 weeks of pregnancy have three times less risk of low birth weight or premature births. But a closer look at the literature will reveal ample evidence already available that women who avoid fish in their diets during pregnancy are at increased risk for delivering their babies early, which increases risk for their babies being born small, sick and dying.

Response:

The US Government emphasizes that fish and shellfish are an important part of a healthy diet for women and young children; and that women and young children should include fish or 9 281 shellfish in their diets due to the many nutritional benefits. Recommendations for selecting and eating fish or shellfish are made by EPA and FDA. These recommendations, if followed, should enable women and young children to receive the benefits of eating fish and shellfish and, at the same time, they can be confident that they have minimized their exposure to the harmful effects of mercury.

Comment:

One commenter ( OAR 2002 0056 5423) notes that the postulated but unconfirmed effects of MeHg on cardiovascular health in the NRC ( 2000) report appear to have contributed to EPA's RfD for MeHg.

Alan Stern, of the New Jersey Department of Environmental Protection and member of the NRC ( 2000) MeHg committee, recently revealed:

" In 2000, the National Research Council's Committee on the Toxicological Effects of Methylmercury issued a report ( NRC, 2000) in which it considered the various adverse health effects associated with the exposure to methylmercury ( MeHg). Among the effects considered were cardiovascular effects. The committee concluded that ` Given the limits of the available data, neurotoxicity is the most sensitive, well documented health endpoints. However, there is emerging evidence of potential effects on both the immune and cardiovascular systems at low doses of exposure. Although these effects are not well understood, emerging data underscore the need for continued research and raise the possibility of adverse effects ... at or below the current levels of concern for developmental neurotoxicity.' The committee recommended that an overall uncertainty factor of adjustment of 10 be applied to the neurodevelopmental point of departure to derive a MeHg reference dose ( RfD). This uncertainty factor, in part, addressed the possibility that cardiovascular effects may ultimately prove to be a more sensitive endpoint than neurodevelopment effects. The US EPA, in its derivation of an RfD for methylmercury, followed the lead of the NRC committee in applying a similar rationale for its 10 fold uncertainty factor adjustment ( US EPA 2004)."

The commenter suggests that EPA should be more critical in providing an independent assessment on this potentially dangerous and poorly documented claim. To that end, the commenter offers several concise criticisms on the two main published studies ( as cited by EPA's NODA) suggesting a connection between MeHg exposure from fish and cardiovascular disease ( CVD), coronary health disease ( CHD) and even death in adults. ( A longer and more thorough review on this recent alarmism about the negative impacts of fish intake on cardiac health can be found in " Fish, Mercury and Cardiac Health" by CSPP.) But it should be pointed out that the third study cited by the EPA's NODA, the Yoshizawa et al. ( 2002, New England Journal of Medicine, vol. 347, 1755 1760) paper, actually reported their inability to confirm an association of total Hg exposure and risk of CVD based on a 5 year follow up of 33,737 U. S. male health professionals. The results of Yoshizawa et al. ( 2002) clearly did not raise the " possibility that 9 282 MeHg in fish can reduce the cardio protective effects of fish consumption in adult males" as incorrectly implied by EPA's citation.

First, the commenter provides some background on the two studies claiming negative cardiac health associations with fish consumption.

( 1) The Finnish Study by Salonen et al. ( 1995, Circulation, vol. 91,645 655; 2000, Atherosclerosis, vol. 148,265 273) and Virtanen et. al., ( 2002, poster presentation in the April 23 26, 2002 American Heart Association, Asia Pacific Scientific Forum at Honolulu, Hawaii): A study of 2005 men from Kuopio, eastern Finland found that men in the highest quarter (> 2.5 ppm) had a 1.6 fold risk of CVD death and 1.7 fold risk of CHD death when compared to men in the lowest three quarters after adjusting for numerous risk factors including age, LDL ( bad) cholesterol and triglyceride, intakes of saturated animal fatty acids and etc.

( 2) The European/ Israeli Study by Guallar et. al., ( 2002, New England Journal of Medicine, vol. 347, 1747 1754): A case control study of 684 men with 724 controls reported increasing toe nail Hg level from 0.11 to 0.66 ppm ( about 0.34 2 ppm in equivalent hair Hg levels) is associated with a doubling of the risk of myocardial infarction after adjusting for numerous risk factors like age, family history of heart attack, smoking status, alcohol intake, diabetes, history of hypertension, selenium intake, etc.

However, as explained in the commenter's report, " Fish, Mercury and Cardiac Health," numerous risk factors other than MeHg in fish will more likely explain most of the findings in Salonen et. al., ( 1995, 2000) and Guallar et. al., ( 2002).

Statistics of mortality from Coronary Heart Disease: Men of Eastern Finland are especially vulnerable " The intake of diary products, potatoes, butter, and sugar products was very high in Finland. A similar but lower intake pattern was observed in The Netherlands. Fruit, meat and pastry consumption was high in the USA. Cereals and wine consumption was high in Italy, while bread consumption was high in Yugoslavia with the exception of the Belgrade cohort. In Greece, the intake of olive oil and fruit was very high, while the Japanese cohorts were characterized by a high consumption of fish, rice, and soy products."

Table 1: Age standardized 25 year death rates per 1000 from CHD in 16 cohorts of the Seven Countries Study. Standard error of rate in parenthesis.

Cohorts N CHD ( death rates/ 1, OOO)

US Railroad, USA 2571 160 ( 7)

East Finland, Finland 817 268 ( 15) Cohorts N CHD ( death rates/ 1, OOO)

9 283 West Finland, Finland 860 180 ( 13)

Zutphen, The Netherlands 878 169 ( 13)

Crevalcore, Italy 993 93 ( 9)

Montegiorgio, Italy 719 60 ( 9)

Rome Railroad, Italy 768 87 ( 10)

Dalmatia, Croatia 671 54 ( 9)

Crete, Greece 686 25 ( 6)

Corfu, Greece 529 48 ( 9)

Tanushimaru, Japan 508 30 ( 8)

Ushibuka, Japan 502 36 ( 8)

Velika Krsna, Serbia 511 43 ( 9)

Zrenjanin, Serbia 516 116 ( 14)

Belgrade, Serbia 536 106 ( 13)

Slavonia, Croatia 696 89 ( 10)

Menotti et al., 1999, European Journal of Epidemiology, vol. 15, 507 515 The commenter's criticisms on Salonen et. al., ( 1995, 2000) include the following points:

( 1) Salonen et. al., ( 1995) own admission: " Theoretically, our findings could be specific only for men in Eastern Finland, who traditionally have a high intake of meat, fish, and saturated animal fat and a low intake of selenium and vitamin C and, most likely, other vegetable derived antioxidants."

( 2) The Kupio population has one of the highest recorded rates of CHD and high consumption of animal fat with high measured levels of LDL ( bad) cholesterol.

( 3) Stern ( 2005, Environmental Research, in press) pointed out that even in Salonen et al. ( 1995) as long as 9 years already elapsed between the collection of hair and urine samples and the recording of a CVD and CHD and death event. Updated report of KIHD Hg related results in Virtanen et. al., ( 2002) extends the elapse time to 16 years or so and hence contributing to a serious potential misclassification of causes and effects.

( 4) Clarkson ( 2002) noted that highest recorded hair level is 15.7 ppm and more than 6 standard 9 284 deviations from the mean and only a small percentage of the population has high hair Hg. Yet high value points may playa major role in this type of study, " it would have been of interest to see if these correlations persisted when the very high mercury levels were excluded."

( 5) No clear accounting for stress   which is believed to be a major risk factor.

The commenter's criticisms on Guallar et. al., ( 2002) include the following points:

( 1) Contradicted by the negative results of Yoshizawa et al. ( 2002) 5 year follow up study of 33.737 US male health professionals that covers a wider range of toenail Hg from 0 to 14.6 ppm ( or about 45 ppm in equivalent hair Hg level)

( 2) Why is LDL cholesterol not measured and identified as a risk factor ( while HDL and total cholesterol were measured)?

( 3) Serious challenges and questions from Plante and Babo ( 2003) in New England Journal of Medicine ( vol. 348, 2151 2152): " Patients with Minamata disease and hair mercury levels above 100 ppm did not have a higher rate of death from heart disease than controls, nor did they have a higher degree of arteriosclerosis. In the Minamata region of Japan, a population of approximately 50,000 with an average hair mercury level of 50 ppm did not have a higher rate of death from heart disease than a reference population of 800,000 with an average level of 9 ppm. Cree Indians with an average hair mercury concentration of 10 ppm have a lower risk of death from circulatory disease than the rest of the population in Quebec, in which the average hair mercury level is 0.5 ppm. If, as Guallar et. al., suggest, mercury increases the risk of myocardial infarction by more than 100 percent when the hair mercury level reaches 2 ppm, how can one explain the absence of effects at doses greater than 100 ppm?"

Concerning " sudden death" the clinical evidence continues that fish nutrition can lower the risk:

" The n 3 fatty acids found in fish are strongly associated with a reduced risk of sudden death among men without evidence of prior cardiovascular disease. As compared with men with levels of long chain n 3 fatty acids in the lowest quartile, those with levels in the highest quartile had an 81 percent lower risk of sudden death." ( Albert et. al., 2002)

"[ W] e have summarized the growing clinical evidence that these n 3 fatty acids are antiarrhythmic and can prevent sudden cardiac death in humans. These n 3 fatty acids have been part of the human diet for some 2 to 4 million years. They are safe and have been listed on the GRAS (` generally regarded as safe') list according to the Food and Drug Administration in amounts up to 3.5 g of fish oil per day." ( Leaf et. al., 2003)

" Alexander Leaf and colleagues suggest a hypothesized cellular mechanism through which 3 PUFAs affect ion channels to reduce the risk of arrhythmia. The 9 285 messages ... are clear. For clinicians, it is time to implement the current American Heart Association dietary guidelines that recommend the dietary intake of 1 to 2 fish meals, particularly fatty fish, each week. For policymakers, there is a need to consider new indication for treatment with low dose n 3 PUFAs supplements ..." ( Siscovick et. al., 2003)

Speaking on cardiac risk concerns, Professor Tom Clarkson, Distinguished Professor of Environmental Medicine at the University of Rochester has commented that:

" Eating lots of ocean fish isn't much of a hazard compared to missing out on the benefits from not eating fish. A slew of scientific reports have shown that eating fish helps protect against cardiovascular disease and enhances brain development before and after birth. Fish is a rich source of low fat protein and is full of fatty acids known to lower cholesterol. Overstating the almost negligible risk of mercury could adversely affect millions of people who face the risk of heart disease."

Dr. Eric Rimm, Professor of Epidemiology and Nutrition at Harvard School of Public Health agreed:

" The message of fish being good has been lost and people are learning more about the hypothetical scare of a contaminant than they are of the well documented benefits of coronary disease reduction. The danger of the tuna fish is not well documented compared to the potential dangers for a 50 year old male or female who are at a much higher risk of coronary health."

Response:

EPA acknowledges that there are complexities, including a variety of potential confounders, that must be considered in relation to potential cardiovascular mortality linked to methylmercury exposure. For additional discussion of this endpoint, see Appendix D and Appendix B of RIA for this rule.

Comment:

One commenter ( OAR 2002 0056 5423) presents Figure O1 to show the rarely seen " evidence" that both EPA and the " NAS review" in 2000 ( see more criticisms of the " NAS" [ actually NRC ( 2000)] review under comment P below) had adopted to support their claims of negative neurodevelopmental impacts from prenatal exposure to MeHg through maternal consumption. The result was drawn from the Faroe Island children study originally published by Grandjean et al. ( 1997, Neurotoxicology and Teratology, vol. 19, 417 428) and the particular endpoint test ( see additional criticisms by CSPP in comment Q below) is the so called cued Boston Naming Test ( note that this is not to be equated to " IQ" as represented in the final section of EPA's NODA). 9 286 The commenter points out that Figure O1 clearly suggests a significant scatter in the test scores as MeHg exposure level changes. It is also worth reminding that this particular endpoint is indeed the best evidence allowing the EPA and " NAS" suggestions of negative impacts with increasing MeHg exposure   as guided by various statistical fitting lines in Figure O1 despite the large scatter. More important to note in Figure O1 is the relative position of the EPA adopted level of MeHg RfD in the equivalent blood Hg levels of 5.8 ppb ( marked as red dashed vertical line in Figure 01). The superposition of the EPA's adopted MeHg RfD shows a clear disconnect to the underlying data which forms the original claim for negative impacts linked to MeHg exposures. The commenter believes that this result makes clear the distinction between the actual levels of harm or concern for MeHg and the hypothetical and ultra precautionary level of safety set by EPA's RfD shown in Figure L1 above.

The commenter notes that there are even more serious issues in the underlying epidemiological data from the Faroe Island children study which exposes its selection for an RfD level as highly inappropriate. Not the least of which is the refusal of the Faroe Islands researchers to release their raw data to allow independent statistical analyses violates EPA's own data quality guidelines.

The MeHg exposure profile for the Faroe Island study is neither compatible nor directly applicable to U. S. fish consumers. By admissions of the original Faroe Island study researchers ( mainly Dr. Philippe Grandjean and Dr. Pal Weihe) and several published scientific evaluations of the Faroe Island study, the Faroe Island results should best be considered as a study assessing exposures to a mixture of chemicals like PCBs, DDT and MeHg rather than MeHg alone. It has long been noted and admitted that the Faroe Island study cohorts were contaminated by maternal exposure to high levels of DDT and PCBs via consumption of pilot whale meat and fat. The PCBs levels were evaluated to be about 600 times the so called Aroclor 1254 RfD level established by EPA's own Integrated Risk Information System ( Dourson et al., 2001, Neurotoxicology, vol. 22, 677 689).

In addition, the commenter states that it should not go unnoticed that in a letter to the EPA, Drs. Kenneth Poirer and Michael Dourson, both as former EPA's RfD/ Reference Concentration Work Group co chairs, had previously provided their scientific findings to the Technical Information Staff at EPA, advising that: " The Faeroe Island studies are not the proper choice for the critical study for a methylmercury RfD." EPA continues to ignore this and more recent scientific evaluations.

Finally, in a February 9, 2004 open letter there is the crucial clarification by Faroe Island Children Study's Chief Physician, Dr. Pal Weihe, that the Faroese children are exposed to Hg by consumption of pilot whale meat only, not fish. In contrast, says Dr. Weihe, the fish consumption most likely is beneficial to their health. Dr. Weihe's letter follows: 9 287 To whom it may concern:

Faroe Islands women do not eat Hg tainted fish and fish consumption does not harm Faroese children.

In the Boston Herald, Friday, February 6, 2004, p. 20 the following was stated about a Hg study in the Faroe Islands conducted in the cooperation with the Harvard University: " A fish industry spokesman said that the Harvard study was flawed because Faroe Islands women typically eat far more mercury tainted fish than do Americans."