Urban Air Pollution, Health, and Policy Instruments. Alan Krupnick Presentation for Energy Week 2005 World Bank, Washington, DC March 15, 2005

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1 Urban Air Pollution, Health, and Policy Instruments Alan Krupnick Presentation for Energy Week 25 World Bank, Washington, DC March 15, 25

2 Overarching goal: Manage risks to maximize benefit to society Pick best pollutants to emphasize Use the best policy instruments to meet emissions reduction goals

3 Prioritization Direct Particulates TSP VOC Pb

4 Health effects by pollutant Lead: Been a high priority PM: Clearest/largest effects on mortality But which species and size? Ozone: 1/1 th the potency of PM on mortality; but new studies suggest new concerns SO2: Hard to separate from PM NO2: Lower potency than ozone CO: Localized effects

5 Table 2. Air Pollution Change by Income Pollutant by country income category* Average for Reduction in average from to ** # cities w/data in both periods Sulfur Dioxide Annual Mean (µg/m 3 ) A (low income) B (lower middle income) C (upper middle income) D (high income) Nitrogen Dioxide Annual Mean (µg/m 3 ) A (low income) 26 1 B (lower middle income) C (upper middle income) D (high income) PM1 Annual Mean (µg/m 3 ) A (low income) B (lower middle income) C (upper middle income) D (high income) Lead Annual Ambient Mean (µg/m 3 ) A (low income) B (lower middle income) C (upper middle income) D (high income) Ozone Annual Mean (µg/m 3 ) A (low income) 79 - B (lower middle income) C (upper middle income) D (high income)

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7 Policy Success

8 Success Wet Sulfate Deposition Scale: Regional

9 SUCCESS: Lead: Trends in five monitoring stations, MCMA (quarter average) 3. Concentration (µg/m³) Xalostoc Pedregal Tlalnepantla Standard: 1.5 µg/m³ (quarter average) Merced Cerro de la Estrella

10 SUCCESS: Sulfur Dioxide: Annual average 1-hr. concentration Mexico City TLA XAL MER PED CES Annual Standard.3 ppm Guadalajara Monterrey ATM OBL LDO TLA CEN MIR AGU VAL Annual Standard.3 pmm NO NE CE SO SE Annual Standard.3 pmm Toluca Puebla City SL AP SC OX CE MT SM Annual Standard.3 ppm Serdán Tecnológico Ninfas Agua Santa Annual Standard.3 pmm

11 Key Issues in Policy Design Ambient pollution standards: Changing the paradigm?

12 Are ambient standards binding or aspirational? Is there a threshold below which no effects on health are expected to occur in all people? For PM, O3 and NO2: No Replace the threshold concept with exposure-risk functions Ambient Standard response concentration

13 Set minimum standards > current standards but require continuous improvement if certain criteria met. Ambient Standard Minimum Standard response concentration

14 Key Issues in Policy Design Ambient pollution standards: Has their usefulness gone? Transboundary pollution

15 Carbon Monoxide over Pacific Ocean NASA MOPITT March-Dec. 2

16 Key Issues in Policy Design Ambient pollution standards: Has their usefulness gone? Transboundary pollution Emissions inventories Monitoring and enforcement Overall legal system Culture of compliance

17 AQM Status Asia: Response Bangkok Beijing Busan Colombo New Delhi Dhaka Hanoi Ho Chi Minh Hong Kong Jakarta Legend: Minimal Limited Moderate Good Excellent Emissions estimates AQM Capability Indices Kathmandu Kolkata Metro Manila Mumbai Seoul Shanghai Singapore Surabaya Taipei Tokyo 11 cities have emission estimates for major source categories (industrial, mobile and domestic/commercial) 4 cities have no emission estimates at all 11 cities have emission estimates for all criteria pollutants (PM, CO, SO 2, NO 2 and HC) 8 cities have estimates of emissions based on measurements 6 cities cross check estimates

18 AQM Status Asia: Response Management Enabling capabilities AQM Capability Indices Bangkok Beijing Busan Colombo New Delhi Dhaka Hanoi Ho Chi Minh Hong Kong Jakarta Kathmandu Kolkata Metro Manila Mumbai Seoul Shanghai Singapore Surabaya Taipei Tokyo 9 cities have AQ standards for all criteria pollutants 18 cities have emission limits and controls on stationary and mobile sources 8 cities actually conduct emission measurements to ensure limits are enforced Legend: Minimal Limited Moderate Good Excellent

19 Strong correlation between AQM and average income/capita Overall AQM Index Score y = 25.55x R 2 = Average Income/Capita US$ (log)

20 Policy Instruments Tradable permits on the short list in DCs CAC not ruled out a priori (esp. sulfur in fuel) Fees on inputs, outputs vs. on emissions Removing subsidies to energy Subsidies on non-polluting substitutes to create price gaps. Voluntary and information approaches CDM

21 SO2 Trading in Taiyuan, China Objective: Establish a workable emissions trading system in Taiyuan to facilitate planned 5% SO2 reduction Methods: Extensive system design and capacity building (software development and trainings) in advance of actual trading- with USEPA help; $$ for locals ADB project

22 Milestones Established scope: 26 facilities Established facility-specific emissions caps Issuance of ET Regulation by Taiyuan Development of Emissions Tracking System Development of Allowance Tracking System Capacity Building through workshops CEMS installed Demonstration Lanxin Chemical Co bought 47 tons SO2 from Jinxi Machinery 15 yuan/t for one year)

23 Conclusions Focus on fine particulates Need better and comparable air monitoring data Performance in banning lead is one hopeful sign among many -- apply to reducing sulfur New(er) ideas: Minimum ambient standards and continuous improvement Intercontinental movement of conventional pollutants City by city infrastructure assessments Transport CDM Local SO2 trading

24 STOP

25 SUCCESS?: Ozone: days above 1-hr. Standard (.11 ppm) and maximum 1-hr. concentration (daily) México City* Guadalajara 4 Days M a xim um.45 4 Days Maximum Monterrey Toluca** 4 Days Maximum.45 4 Days Maximum * Monitoring Stations considerated: TLA, XAL, MER, PED ó CES ** Monitoring Stations considerated: Aeropuerto, Toluca-Centro ó Metepec

26 PM 1 : days above 24-hr. Standard (15 µg/m³) and maximum 24-hr. concentration of year (1) México City* Guadalajara 15 Days Maximum 5 15 Days Maximum Monterrey Toluca 15 Days Maximum 5 15 Days Maximum * Monitoring Stations considerated: TLA, XAL, MER, PED ó CES

27 Taiyuan, China

28 Institutional Issues Going In Too many agencies; unclear areas of authority Weak EPB and environmental mgmt system Limited emissions, public health information Weak enforcement and focus on pollutant concentrations, not mass emissions Manual (stack) monitoring vs CEMs

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31 Changes made to our recommendations High penalties for busting cap to very low penalties Banking to banking only with Taiyuan EPB approval Tight emissions cap to negotiated cap Eliminated shutdown credits

32 Taiyuan EPB says, We will implement SO2 trading in Taiyuan, and ask the new enterprises to buy allowances from the existing ones.

33 Lessons Learned Understand what it takes to build capacity Software, audit, meetings, trainings, leadership buy-in and participation, legal foundation Need attention to big picture and details Use lending/grant institutions for money and leverage Is this enough?

34 Pollutant by country income category* Average for Reduction in average from to ** # cities w/data in both periods SO 2 # days guideline exceeded A (low income) B (lower middle income) C (upper middle income) D (high income) NO 2 # days guideline exceeded A (low income) 2 8 B (lower middle income) C (upper middle income) D (high income) Ozone # days guideline exceeded A (low income) 9 - B (lower middle income) C (upper middle income) D (high income)

35 Latin America: Average PM 1 levels vs. Per capita income PM1 Concentrations (ug/m3) , 4, 6, 8, 1, Per capita income (US$/person)