Chemical industry regulation costs

Costs associated with increased government regulation are also difficult to quantify. Public concern in response to chemical release accidents affects regulators and community policy groups. It is evident that the U.S. chemical industry is already spending large amounts of money to avoid accidents and to deal with their consequences when they occur these costs are borne in part by the consumers. Continued expenditures are likely as industry strives to achieve an "acceptable" level of public safety throughout all chemical industry operations. 

At the same time, however, there is emerging evidence that PMN requirements have significantly inhibited innovation in the chemical industry. Section 5 has inevitably had some impact on innovation, and EPA regulations that add to the basic statutory requirements are likely to impose burdens on the chemical industry that are unnecessary. That is why CMA recommends that the Agency, at a minimum, limit those regulations to the clear requirements of the statute. Requirements such as supplemental reporting of PMN information, mandatory consumer contacts, advance substantiation of confidentiality claims, and the "invalidation" of incomplete PMNs, will only serve to increase the costs of a process that already imposes substantial burdens. Since EPA can adequately protect human health and the environment without these requirements, they should be eliminated. 

APEOs are used in domestic and industrial applications. They are applied as detergents, emulsifiers, wetting agents, dispersants or solubilisers. APEO derived from nonylphenol (NP), i.e. nonylphenol ethoxylates (NPEOs) comprises about 80% of the total market volume, while octylphenol-derived surfactants (OPEOs) account for 15-20%. Because of the persistence and toxicity of some degradation intermediates, their use has been reduced in several countries either through voluntary bans by the chemical industry or by legal regulations. However, excellent properties in combination with comparably low production costs hampers their complete replacement with other more environmentally acceptable alternatives. 

For example, the benefit of a cleaner environment was not examined and, moreover, would be very difficult to measure. However, an objective of this study is to contribute to the on-going process of evaluation of costs versus benefits of governmental regulation of business. Hence, the following is a summary assessment of the costs versus benefits of environmental research in the chemical industry. 

Worldwide, in 1987 through 1989 the industry, whether in specialties or in basic chemicals, has certainly had its most prosperous years ever. The chemical industry, on the whole, does not, however, enjoy a very favorable image in the eyes of the public. The harmful spillovers caused by untoward accidents are given wider publicity by the media than the benefits the industry provides. In consequence, administrations that were anxious to soothe the more or less justified fears of their citizens have brought out a spate of regulations often more restraining and therefore more costly than is really necessary. 

A great deal of controversy surrounds the business effects of REACH. Environmental NGO argue that the chemical industry is crying wolf over the potential negative effects that the regulation will have on EU businesses [283]. NGO support this assertion with the fact that the cost estimates for implementing the current REACH proposals represent only about 0.05 % of the annual turnover of the EU chemical industry (about 400 billion) [283]. The costs to downstream chemical users represent <1% of their total turnover of around 425 billion [283]. 

Indeed, there is no doubt that the chemical industry has made a considerable effort in recent decades to reduce its impact on the environment, and consumption of raw materials, including energy. However, if we look in more detail at the breakdown of these costs, we see that they are mainly associated with a necessary adaptation to environmental regulations and security, and only a small part is dedicated to iimovation process for the introduction of new technologies that have low environmental impact and/or are intrinsically safe. 

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