Letter to The Honorable Michael S. Reagan, Administrator, U.S. Environmental Protection Agency (February 14, 2024)

Summary

The House Committee on Small Business writes on February 14, 2024 to Administrator Reagan of the Environmental Protection Agency about five of the EPA's rules and proposed rules that could substantially harm U.S. small businesses. The letter discusses the Commercial Ethylene Oxide (EtO) Sterilization Technology Review, a methane rule, the PFAS National Primary Drinking Water Regulation, the Reconsideration of the National Ambient Air Quality Standards for Particulate Matter, and the Clean Power Plant Rule. The Committee states it is concerned that the EPA failed to consider small entities in the rulemaking process. The Committee requests documents and information on each rule no later than February 28, 2024. The signature block names Roger Williams, Chairman.

Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used

Full text

                                             February 14, 2024

The Honorable Michael S. Reagan
Administrator
U.S. Environmental Protection Agency
1200 Pennsylvania Ave. NW
Washington, DC 20460

Dear Administrator Reagan:

        The House Committee on Small Business (Committee) writes regarding five of the
Environmental Protection Agency’s (EPA) rules and proposed rules that could substantially
harm U.S. small businesses. Since 2021, rules issued by the EPA are estimated to have cost the
U.S. economy over $249.7 billion across all industries and increased paperwork hours for all
businesses by nearly 6.5 million hours.1 The rules discussed here will have a significant impact
on a substantial number of small businesses, increasing costs and regulatory burdens. While
some of these rules do not directly regulate business activity, they would—individually and
collectively—have a major impact on U.S. small businesses and their operations. The Committee
is concerned that the EPA failed to consider small entities in their rulemaking process for the
following rules.

National Emission Standards for Hazardous Air Pollutants: Commercial Ethylene Oxide
(EtO) Sterilization Technology Review

        This proposed rule would effectively ban the commercial use of Ethelyne Oxide (EtO).2
EtO is an essential chemical used throughout numerous industries in the U.S., most notably in
the sterilization of medical equipment.3 Eliminating EtO would require manufactures to change
how they sterilize medical equipment, either adopting more costly or less effective solutions.4
Small medical device manufacturers may not be able to sterilize their equipment properly with
alternatives to EtO, and it will be costly for these entities to receive new Food and Drug
Administration approval for the new sterilization techniques. While larger entities may be able to
afford to comply with this rule, small businesses may not be able to shoulder the costs and could


1
  Regulation Rodeo, AM. ACTION FORUM (last visited Feb. 9, 2024).
2
  NAM Pushed Back on Restrictive Chemical Rule, NAT’L ASSOC. OF MANUFACTURERS (Nov. 15, 2023).
3
  National Emission Standards for Hazardous Air Pollutants: Commercial Ethylene Oxide (EtO) Sterilization
Technology Review, 88 Fed. Reg. 22790 (Apr. 13, 2023) (to be codified at 40 CFR § 63).
4
  Letter from Cathy McMorris Rodgers, et al., Chair, H. Comm. on Energy & Commerce, to Lael Brainard, et al.,
Director, U.S. Nat’l Econ. Council. (Sep. 28, 2023); NAM Pushed Back on Restrictive Chemical Rule, NAT’L
ASSOC. OF MANUFACTURERS (Nov. 15, 2023).
The Honorable Michael S. Reagan
February 14, 2024
Page 2 of 4

be forced to shut down.5 Despite the EPA initially indicating this rule would cost companies only
$86 million to comply with, industry estimates that the true total cost is over $220 million for all
businesses.6 It is unclear whether the benefits supposedly achieved by this rule would overcome
the actual human harm that could result from faulty medical device sterilization.

Methane

         On December 2, 2023 the EPA issued this rule which implements unnecessary
requirements that oil and gas companies must constantly and actively search for methane leaks in
their facilities.7 This undertaking would be costly, and incomplete compliance may result in
businesses being fined. Oil and gas companies already have an incentive to stop leaks, given that
each leak is lost profit. Additionally, the rule could require businesses to capture excess methane
that is currently being released or flared. This would require a costly retooling.8 Industry has
described this regulation as incoherent and indicated it would limit the ability of companies to
innovate.9 Nearly 90 percent of all oil and gas extractors are small businesses, these rules will
disproportionately increase costs for them, and may result in many small wells closing.10

PFAS National Primary Drinking Water Regulation Rulemaking

        On September 28, 2023 the EPA issued a rule which would require treatment of
perfluoroalkyl and polyfluoroalkyl substances (collectively “PFAS”) used in manufacturing
under certain circumstances.11 These new standards are allegedly aimed at reducing the amount
of PFAS in the water supply.12 The EPA issued this rule despite concerns over whether this rule
would actually improve health outcomes, and it is estimated to cost water systems, big and small,
approximately $40 billion.13 PFAS is used in the production of medical devices, cell phones, and
numerous other products. Regulating its use will create additional regulatory burdens on water
systems and manufacturers, and likely increase consumer costs on many goods.14 Small
businesses that use PFAS may experience substantial disruptions to their operations when these
rules are enforced.




5
  Katie Hobbins, EtO Proposal Could Cost Companies More Than the $220 Million Estimated, MEDICAL DEVICE &
DIAGNOSTIC INDUS. (Jun. 14, 2023).
6
  Katie Hobbins, EtO Proposal Could Cost Companies More Than the $220 Million Estimated, MEDICAL DEVICE &
DIAGNOSTIC INDUS. (Jun. 14, 2023).
7
  Standards of Performance for New, Reconstructed, and Modified Sources and Emissions, Guidelines for Existing
Sources: Oil and Natural Gas Sector Climate Review, 40 CFR § 60 (Dec. 2, 2023).
8
  Jennifer Hijazi, Popular EPA Methane Rule Comes with Cost, Monitoring Concerns, BLOOMBERG LAW (Dec. 8,
2023); EPA Finalizes Methane Rule, NAT’L ASSOC. OF MANUFACTURES (Dec. 6, 2023).
9
  News Release, Am, Petrolium Inst., API Calls on Congress to Repeal IRA’s Methane Fee (Jan. 12, 2023).
10
    Oil, Natural Gas, Our Economy and Small Business, SMALL BUS. & ENTREPRENEURSHIP COUNCIL (May 22,
2023)
11
   PFAS National Primary Drinking Water Regulation Rulemaking, 88 Fed. Reg. 18638 (Mar. 29, 2023).
12
   EPA Proposes PFAS Standards, NAT’L ASSOC. OF MANUFACTURERS (Mar. 16, 2023).
13
   Id.
14
   Pat Rizzuto, PFAS Rule to Cost Many Millions More, EPA Analysis Finds, BLOOMBERG LAW (Nov. 23, 2023).
The Honorable Michael S. Reagan
February 14, 2024
Page 3 of 4

Reconsideration of the National Ambient Air Quality Standards for Particulate Matter
(PM2.5)

         This rule would require the enactment of significant controls to mitigate the emission of
particulate matter 2.5 micrometers or smaller—which is emitted when almost anything is burned,
destroyed, or crushed.15 This new rule will most heavily impact industries that must heat or burn
raw materials and mining operations.16 This will increase the regulatory burden for companies of
all sizes, make the permitting process more difficult, and lead to increased outsourcing.17 Small
businesses would be faced with significant and costly operations adjustments, with the rule’s
projected costs between $162 and $197 billion for all companies to comply with. It is also
estimated that this rule could put nearly one million jobs at risk.18

Clean Power Plant Rule

         This proposed rule would require power plants to implement carbon capture technology
and/or integrate hydrogen into their fuel cycle; plants that do not implement these technologies
and meet emissions goals could be shut down.19 The process of integrating carbon capture or
hydrogen technologies would be costly for manufacturers—estimates range from $10 to $14
billion across the industry.20 While the cost of this rule is substantial, it also relies on technology
that is either unproven or has not been deployed on a large scale.21 Implementing cutting edge,
expensive technologies increases cost for small businesses. This would also have a knock-on
effect of increasing energy costs for consumers.22 Small businesses are reliant on the electric grid
and this rule would increase the cost of energy, while also potentially creating energy scarcity in
more rural communities. Additionally, such a large change could amount to a “generational
shift” in technology, which the Supreme Court has previously ruled as an impermissible way to
implement best practices in emission reduction standards.23

        It is vital for agencies to examine small business interests which make up 99.9 percent of
all businesses in the U.S. America’s small businesses deserve to have their voices heard and

15
   Reconsideration of the National Ambient Air Quality Standards for Particulate Matter, 88 Fed. Reg. 5558 (Jan.
27, 2023)(to be codified at 40 CFR §§ 50, 53, 58)
16
   NAM pushed back on harmful new air regulations, Nat’l Assoc. of Manufacturers (Feb. 9, 2023).
17
   Id.
18
   Letter from Shelly Moore Capito, et al., Ranking Member, Sen. Comm. on Env’t and Pub. Works, to Michael
Reagan, et al., Administrator, U.S. Env’t Prot. Agency (Dec. 18, 2023); U.S. Air Quality Standards and the
Manufacturing Sector, NAT’L ASSOC. OF MANUFACTURERS (Apr. 2023).
19
   88 Fed. Reg. 33240 (May 23, 2023)(to be codified at 40 CFR § 60).
20
   Id., See also NAM Fights Restrictive Power Plant Rule, NAT’L ASSOC. OF MANUFACTURERS (Nov. 29, 2023).
21
   Erin Kelly, Thousands of Co-op Members Voice Opposition to EPA’s Power Plant Rule, NRECA (Aug. 22,
2023); Id.
22
   The Biden Administration’s Executive Overreach and Its Effect on American Energy Independence: Hearing
Before H.Comm. on Natural Resources Subcomm. on Oversight and Investigations, 118th Cong., 3 (May 11, 2023)
(statement of Diana Furchtgott-Roth, Dir., Center on Energy, Climate, & Env’t, & The Herbert and Joyce Morgan
Fellow in Energy and Env’t Policy, The Heritage Found.).
23
   Letter from Shelly Moore Capito, et al., Ranking Member, Sen. Comm. on Env’t and Pub. Works, to Michael
Reagan, et al., Administrator, U.S. Env’t Prot. Agency (Dec. 18, 2023); See also West Virginia v. EPA, 142 S. Ct.
2587 (2022).
The Honorable Michael S. Reagan
February 14, 2024
Page 4 of 4

considered. We therefore request the following documents and information on each of these rules
as soon as possible but no later than February 28, 2024:

      1. Provide the estimated number of small businesses that will be impacted by each of these
         rules.

      2. Provide the estimated additional compliance costs on small businesses that are associated
         with each of these new rules.

      3. Provide location where small businesses can go to examine your analysis of the impact
         these rules will have on their operations.

      4. Provide a list of all alternatives that have been considered to lessen the impact on small
         businesses for each of these rules.

       To schedule the briefing or ask any related follow-up questions, please contact the
Committee on Small Business Majority Staff at (202) 225-5821. The Committee on Small
Business has broad authority to investigate “problems of all types of small business” under
House Rule X. Thank you in advance for your cooperation with this inquiry.

                                          In God We Trust,




                                        Roger Williams
                                            Chairman
                                    Committee on Small Business




cc:      The Honorable Nydia M. Velasquez, Ranking Member
         Committee on Small Business


File and source

File

2024-02-14_HouseSBC-Majority-to-epa_letter-to-epa-re-rules.pdf

Size

226,086 bytes

SHA-256

f2a31c8705638f5906d255f71ac6569507804dd1f6ae588d925c8bb17299ea7a

Our copy

2024-02-14_HouseSBC-Majority-to-epa_letter-to-epa-re-rules.pdf

Original

smallbusiness.house.gov