CONSAD Research Corporation
Economic Development
PENJERDEL Action Plan for the Philadelphia Region
Executive Summary
The PENJERDEL Action Plan for the Philadelphia region contains provisions that are intended to result in accelerated attainment of the National Ambient Air Quality Standard (NAAQS) for ground level ozone. An integral part of the Action Plan is the reclassification of the region from severe to serious nonattainment for ozone. The Action Plan prescribes emission reductions for local point, area, and mobile sources. These emissions reductions would occur sooner than reductions mandated by the Pennsylvania Department of Environmental Protection that would be expected under the current severe ozone nonattainment classification. The early attainment of the NAAQS standard for ozone that would result from the Action Plan will not only improve air quality sooner, but will also relieve certain direct and indirect economic burdens on businesses and individuals in the Philadelphia metropolitan area.
The CONSAD report presents the results of an impact analysis of the estimated economic benefits to the Philadelphia region if the PENJERDELAction Plan were implemented, and the region were to be reclassified from severe to serious nonattainment for ozone and achieve attainment sooner. This comparative analysis of alternative approaches to attainment is based on data describing the number and characteristics of businesses, the emissions inventories for different categories of sources contributing to the ambient ozone levels, the cost of implementing different emission control strategies and technologies, and the demographics of workers in the Philadelphia region.
The results of this economic impact analysis indicate that the implementation of the PENJERDEL Action Plan, and the reclassification of the ozone nonattainment status of the Philadelphia region and earlier attainment of the NAAQS for groundlevel ozone, would result in benefits to the economy of the Philadelphia region that include the following:
Increased employment. An estimated 800 to 1,700 directly affected jobs, mostly in the manufacturing sector, would be saved at existing businesses in the Philadelphia region. In addition, an estimated 1,600 to 5,100 jobs would be saved in indirectly affected business sectors. In total, an estimated 2,400 to 6,800 jobs would be saved in the Philadelphia region if the PENJERDEL Action Plan is implemented.
Additional employment growth would also be associated with existing businesses that may expand and new businesses that may be created in the Philadelphia area.
Reduced jobs-at-risk. The total number of directly affected jobs-at-risk in the Philadelphia region would be reduced by an estimated 9,300 jobs. An additional 18,600 to 27,900 indirectly affected jobs-at-risk would also be potentially avoided. The term jobs-at-risk describes workers who are likely to experience termination or severe uncertainty regarding termination, reduction in wages and/or other employment benefits, and number of hours worked.
Lowered consumer prices. Consumers in the Philadelphia region will save an estimated $117 million per year in the cost of gasoline. This estimated cost savings reflects the difference in cost between Reformulated Federal Gasoline (RFG) II fuel and more expensive fuel options. The sale of RFG II fuel will commence in 1999, and will continue to be sold as part of the PENJERDEL Action Plan. Fuel options that are more expensive than RFG II may be required in the Philadelphia region if the area retains its current severe nonattainment classification.
In addition, there will be substantial reductions in prices associated with goods and services produced by businesses that are directly and indirectly affected by regulations intended to reduce ozone concentrations (e.g., printers, dry-cleaners, painters, metal finishers, etc.). Lowered costs-of-compliance. The total cost to industry of complying with environmental regulations for controlling stationary source NOx emissions would be reduced by an estimated $148 million dollars per year. Additional cost savings would also result in the control of area source VOC emissions. Improved quality of life for workers and residents in the Philadelphia region.
The PENJERDEL Action Plan is designed to attain the current National Ambient Air Quality Standard for ground level ozone earlier than would be attained under the current severe ozonenonattainment classification. The Action Plan will attempt toachieve attainment sooner as a result of businesses implementingcertain emission reduction strategies earlier, and this avoidingfuture, potentially higher cost, control strategies.
The analysis examined only the economic impacts of theimplementation of the PENJERDEL Action Plan, and does not providea scientific assessment of the Action Plan and its estimated impact on ambient ozone concentrations.
© CONSAD Research Corp.
UPDATE: 10/19/99