Economics of Cluster Rule Compliance, 1998 Cluster Rule Symposium Proceedings

The ramifications of implementing the Cluster Rule could result in a negative impact on the Pulp & Paper Industry. The most expensive way to deal with the Cluster Rule is to simply meet the regulations. This generally will not have the lowest first cost and will not generate payback benefits. This presentation explores what the EPA perceives the economic impact of the Cluster Rule to be. A number of mills were polled to determine their anticipated costs and these costs are compared to the EPA estimates. In all cases, the mills have estimated higher costs than the EPA. The danger here is that any mill that installs an expensive compliance program is giving a competitive advantage to any mill that manages to comply in a more cost effective manner. It is concluded that Cluster Rule expenditures must be considered in the same vein as any normal project. Some return on investment (ROI) must be considered. Other presentations in this program will develop this theme.