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Protecting Drinking Water: The Safe Drinking Water Act. Chapter 16. SDWA is tougher than CWA to ensure the safety of drinking water . 1. Overview of Policy. _________________________ (SDWA) of 1974 Authorized EPA to set standards (shifted responsibility from the Public Health Service)
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Protecting Drinking Water:The Safe Drinking Water Act Chapter 16 SDWA is tougher than CWA to ensure the safety of drinking water
1. Overview of Policy • _________________________(SDWA) of 1974 • Authorized EPA to set standards (shifted responsibility from the Public Health Service) • Allcontaminants were addressed, not just bacteria • SDWA Amendments of 1986 • Accelerated standard-setting; imposed “lead ban”; improved protection of groundwater; listed 83 contaminants • SDWA Amendments of 1996 • Adds risk assessment and benefit-cost analysis to standard-setting; establishes a Drinking Water State Revolving Fund (DWSRF); promotes prevention
Bottled Water • Not directly regulated under SDWA • Controlled by ____________________________ (FDA), not EPA • FDA must adopt EPA’s standards for drinking water • FDA has own standards for aesthetics and health
2. Setting Standards: National Primary Drinking Water Regulations (NPDWR) • Aimed at protecting human health • Uniformly applied to all public water systems • Each NPDWR has three parts • Maximum contaminant level goal (MCLG) • level at which no known or expected adverse health effects occur with margin of safety; not enforceable • Maximum contaminant level (MCL) • highest level permitted; as close to MCLG as feasible; enforceable • Best available technology (BAT) • treatment technology that makes MCL achievable
3. Economic Analysis: Standard-Setting • MCLGs are __________________ • Before 1996 SDWA, MCLs also were benefit-based, since MCLs link to MCLGs • 1996 SWDA amendments requires EPA to conduct an Economic Analysis (EA) for any proposed NPDWR • Must determine whether benefits of a new MCL justify costs • Important because ignoring costs means MCLs could be set to maximize benefits, causing _____________________
overregulation Benefit-based MCL (at AB) $ TSC Maximum TSB TSB 0 AB A Ae
Total social benefits (TSB) are maximized at the abatement level where MSB = 0 Net social benefits (= TSB - TSC) are maximized at the abatement level where MSB = MSC MSB = the slope of TSB = the first derivative of TSB = d(TSB)/dA MSC = the slope of TSC = the first derivative of TSC = d(TSC)/dA
4. Pricing WaterDoes Price Matter? • Some evidence suggests that consumption of water issensitive to ________ • Comparing domestic with international data • US water consumption is relatively _______ • US water prices are relatively _______ • Suggests that pricing water can influence conservation
Local Pricing PracticesSurvey Data a 200 survey of community water systems • ___________________: (29.3%) • price is independent of use; marginal price = 0 • efficient only if MC = 0 • ______________________: (50.6%) • charge increases with higher use at constant rate • efficient only if MC were constant at same rate • ____________________: (30.6%) • declining block and increasing block Source: U.S. EPA, Office of Water (December 2002), p. 29.
$ Price Q of water use Declining Block • Price falls as Q rises • Intent is to encourage consumption so that scale economies can be achieved • Inefficient because it uses average cost pricing vs. marginal cost pricing
Price $ Q of water use Increasing Block • Price rises as Q rises • Provides incentive for conservation • Efficient since it considers rising MC along with MB of consumption
