PAINT LIFECYCLE/COST BENEFIT PROJECT – OUTSTANDING ISSUES (Full Group) September 15, 2006 LCA Issue Notes/Status/Next Steps to Resolution #L1 #L2 #L3 Estimate of average household annual generation of leftover paint Estimate of average frequency of paint management (e.g., how often do people clear out the paint they store; household paint throughput) TRACI – human health impacts of smog included? Barry sent Abt’s revised estimates 8/23. Bev provided comments 8/24. Dave D. sent a proposed resolution 8/25. Barry and industry are in agreement (as of 8/30) at 0.33 gallons/household-year (latex). Government group concurred with 0.33 gallon/household-year (9/13), noting that these are national averages and that on the individual household level, paint is not discarded annually (separate issue see L2, below). Current Status - Resolved The range is now estimated at 6-16% of sales (from a previous 8-22%), with a point estimate of approximately 10% based on population. Lifecycle report will discount for latex and non-residential. Infrastructure report will not discount since latex and oil-based are included in system. Issue raised by government in 5/23 memo (response to 5/10 ERG memo; see comment 3b). ERG responded that survey results will help model this. However, 9/1 draft assumes that average household discards their paint annually. Government objects: data shows that households hold on to their paint for more than a year. No reason they discard it once every year. Data from paint age studies and McKenzie-Mohr research help inform this. Industry has concerns with the government proposal – Current Status: Industry to provide comments, discussions will continue in Charlotte. David A. asked Bill F. on 8/23. ERG checked with Jane Bare (TRACI developer): human health impacts of smog excluded. Bill F. doesn’t want to create a “custom health impact” category. 9/6: government will reconsider, bring a proposal back to the full group. Current Status: Waiting for response from government. 1 PAINT LIFECYCLE/COST BENEFIT PROJECT – OUTSTANDING ISSUES (Full Group) September 15, 2006 LCA Issue Notes/Status/Next Steps to Resolution #L4 Direct inhalation of emissions from drying/disposal of latex paint (from cans) and drying of latex paint (on walls) after use – whether and how to model, describe 7/31 David A. and Dave D. agreed that the LCA/CBA report should have a preface which states that conclusions are the consultant’s, not those of any stakeholder. 8/16 ERG recommends reporting total VOC releases, but not modeling human health impacts. Industry agrees and also expressed strong concern about what the report says about health impacts of paint fumes. What about emissions other than VOCs? Current Status ERG: TRACI does not model health impacts from paint drying NEW GOVERNMENT PROPOSAL Government believes that a certain percentage of residents will not be able to dry leftover latex paint outdoors, and will be unwilling to dry leftover latex paint indoors (apartment/condo dwellers, no porch/balcony/fenced yard, children/pets, high humidity regions, during winter in cold regions, etc.) Government believes that these people will either dispose of their paint improperly (which is not being modeled) or will bring the leftover paint to a collection. Government therefore proposes that ERG limit Method 2 to less than 100% of leftover paint supply. Government also proposes that ERG state in the LCA that due to time and financial constraints, as well as technical limitations, it was unable to model the health impacts from drying of paint, and not to pursue these costs further unless government, in its own efforts, can provide “new” information #L5 Land use impact category – replace with “total energy?” Industry has concerns with the government proposal, Industry will provide comments and suggests we discuss at the Charlotte meeting 8/16 - ERG proposes replacing land use impact category with “total energy.” 8/25 - Government concurs. 9/6 – Industry concurs. Current Status: Resolved 2 PAINT LIFECYCLE/COST BENEFIT PROJECT – OUTSTANDING ISSUES (Full Group) September 15, 2006 LCA Issue Notes/Status/Next Steps to Resolution #L6 Collection-based “dry and dispose” method for management of paint #L7 % of households using kitty litter for consumer-based “dry and dispose” Based on survey results, ERG found that large quantities of paint unsuitable for further use as paint are going to Amazon. Survey didn’t identify any programs using Portland cement; instead, sawdust, clay, and air drying are reported. 8/16 - ERG recommends modeling disposal limited to “true disposal methods” (not Amazon) and evaluating clay and sawdust as additives (but not Portland cement). ERG would assume that sawdust is free of production burdens, but clay assumes the mining impacts. 8/25 - Government concurs, but reserves right to reopen assumption that sawdust comes in free of upstream burdens based on results of first draft report. 9/6 – Industry OK with this. Current Status ERG is proceeding with its recommendation to model disposal limited to “true disposal” methods. Steve S., Dave D., David A., and Scott C. discussed this on 7/13. In the interest of time, 9/1 ERG draft is based on consumer drying the paint with no additives. ERG proposes a sensitivity analysis based on the use of clay-based cat litter as a stabilizing agent. Government proposes that since cans over a certain fullness will require some additive, the base case should be modeled as a blended average (some cans dried with, some without). Sensitivity analyses could be conducted on the two extreme cases (0% additive, 100% additive), if desired. Industry prefers to model 0% and 100% and would be willing to work with government side on a base case blended average however industry still concerned about purchasing additives – since many “zero cost” additives exist. Current Status: Need to develop base case blended average. Need to continue discussions on kitty litter vs. “zero cost” additives. 3 PAINT LIFECYCLE/COST BENEFIT PROJECT – OUTSTANDING ISSUES (Full Group) September 15, 2006 LCA Issue Notes/Status/Next Steps to Resolution #L8 What assumptions, if any, should be made about partial cans? #L9 #L10 Are 10 management methods (6 pure, 4 modified) adequately described? % of recycled/reused paint purchases that displace virgin paint (e.g., will recycled paint displace virgin paint) See ERG 5/10 memo, question 2 and government 5/23/06 response. ERG has comprehensive data from Metro and can develop a “fullness histogram”. ERG will profile the number of cans of leftover paint generated vs. the number of cans of leftover paint brought to an HHW facility. ERG will adjust survey results to account for households that don’t send cans for collection (likely to be less full). ERG will determine the maximum number of inches of leftover paint left in a paint can that HHW operators say can be managed through air drying vs. needing a drying agent (assumed to be kitty litter applied at a ratio of 1:1). Group decided to wait for results of survey, then review again. Current Status: ERG to summarize Metro data; group will discuss. See ERG 5/10 memo, question 1 and government 5/23/06 response. Group decided to wait for results of survey, then review again. ERG addressed in 9/1 memos? Current Status: In process (government and industry to review) LCA SOW treats this as two extremes: 0% displacement and 100% displacement. This may result in two very different sets of conclusions. Government proposes that the Lifecycle workgroup jointly implement a simple survey of recycled paint buyers to see if we could narrow this range. This work could be done with no extra work for the consultants. Government and industry would agree on the survey design, and the survey could be implemented by Metro Paint (Metro OR), Local Colors (Chittenden County VT), and other paint recyclers. Industry would like to discuss the government survey details – however Industry is very concern about the displacement assumptions considering that there are good reasons why there is no market for recycled paint Current Status: Will discuss in Charlotte 4 PAINT LIFECYCLE/COST BENEFIT PROJECT – OUTSTANDING ISSUES (Full Group) September 15, 2006 LCA Issue Notes/Status/Next Steps to Resolution #L11 VOC content of virgin vs. postconsumer paint #L12 Recycled coatings market demand 9/1 ERG draft assumes 150 g/L for all paints, based on limited responses to surveys and use of national averages (not specific brands, facilities, product lines). 9/6 industry says recycled paint is older, therefore should have higher VOC content than virgin. Industry’s concern is that the VOC content of virgin latex paint is 100 g/l or less (Industry is working on the data; Barry Elman to support and Metro data already provided) yet the Green Seal Standard for Recycled Paint is 250 g/l or less Bev notes that since currently modeling only has VOCs impacting smog, any changes here likely won’t have a big impact. Current Status: Industry (and Barry) will provide VOC data then group will discuss again Survey data shows that some recycled paint has high transport due to shipments to Mexico, etc. caused by insufficient demand. Data in 9/1 draft removed outliers, assumed there are or will be local markets. ERG recommends this as a sensitivity analysis. 9/6 industry says that outliers should be included in the base case, since market is the constraining factor today. Government response: we aren’t modeling the current market; the certification standard should improve the market; modeling impacts of recycled paint use in Mexico, China is exceptionally problematic. Industry response – there is no evidence to indicate the current market will get any better – the current data is the best we have – which shows that very high transport is needed to get the recycled paint to the consumer (given lack of retail sales structure and lack of market within the us (no need to get into foreign markets). These high transport costs are one way to model problems with recycled paint market – so data points should be included in the base case. Current Status: ERG proposes to evaluate market distance as a sensitivity analysis. Group will need to discuss again. 5 PAINT LIFECYCLE/COST BENEFIT PROJECT – OUTSTANDING ISSUES (Full Group) September 15, 2006 CBA Issue Notes/Status/Next Steps to Resolution #C1 Definition of baseline #C2a #C3 See government 8/3 memo, comment #5. Is the baseline “current handling practices for latex paint” or “leftover paint remaining unmanaged in consumers’ homes” (e.g., all stockpiled)? Government believes the baseline should be modeled as all paint being stockpiled in consumers’ homes, since this is easier to derive as compared to current handling practices for latex paint. It is important that we reach agreement on a clear baseline. However, since the CBA results will be measured equally from this baseline, the result will not differ as a result of the choice of baseline. 9/6 Jeff C. states that baseline may not be needed since we’re not evaluating a “do nothing” scenario. Defining a baseline was included in the SOW. David A. to convene a subgroup (Jeff, Dave D., Barry, David A.) to discuss this further. David A. sent clarifying question to Jeff on 9/14. Current Status: In process (David A.) Scarcity rent See government 8/3 memo, comment #11, and ERG 8/24 memo to David A. (e.g., resource In 8/25 call with Jeff C., David A. asked about publicly-owned resources, such as oil and minerals depletion; added extracted from public lands. Jeff C. said he needs to defer to Drew L. benefits on owning Jeff C. to talk with Drew L. then respond to David A. a scarce resource) Current Status: In process (ERG) Other issues in See government 8/3 memo, comments 1 – 2 and 4 - 10, and ERG 8/24 memo to David A. 7/19 ERG memo ERG says it will respond to specific comments in revisions to the methods discussion that will appear “modeling the in future draft reports. environmental and Industry says “no additional comments” - 8/23 email. health benefits of ERG moving forward based on government comments. leftover paint management” Current Status: In process (ERG) (not shown above) 6 PAINT LIFECYCLE/COST BENEFIT PROJECT – OUTSTANDING ISSUES (Full Group) September 15, 2006 CBA Issue Notes/Status/Next Steps to Resolution #C4a #C5 #C6 EPA National Center for Environmental Economics (NCEE) review of 7/19 ERG memo “modeling the environmental and health benefits of leftover paint management” Other issues in 7/19 ERG memo “modeling the consumer benefits of leftover latex paint management” EPA National Center for Environmental Economics (NCEE) review of 7/19 ERG memo “modeling the consumer benefits of leftover latex paint management” NCEE staff have reviewed the 7/19 memo but comments have not been transmitted yet. Barry E. to transmit comments. ERG, industry and government to review and discuss as needed. Current Status: Unresolved (Barry to send comments) See preliminary industry comments in 7/21 e-mail from Dave D.; 8/23 e-mail “no additional comments.” See government 8/3 memo, comments 12 – 23, and ERG 8/24 memo to David A. ERG says it will respond to specific comments in revisions to the methods discussion that will appear in future draft reports. ERG moving forward based on government comments. Current Status: In process (ERG) NCEE staff have reviewed the 7/19 memo but comments have not been transmitted yet. Barry E. to transmit comments. ERG, industry and government to review and discuss as needed. Current Status: Unresolved (Barry to send comments) 7 PAINT LIFECYCLE/COST BENEFIT PROJECT – OUTSTANDING ISSUES (Full Group) September 15, 2006 CBA Issue Notes/Status/Next Steps to Resolution #C7 Avoided travel and purchase costs (avoided virgin paint). #C8 Education costs Government - 8/3 memo asked if these avoided costs would be included. ERG - 8/23 memo and 8/25 conversation between Jeff C. and David A.: ERG says “yes, credit will be provided.” Current Status: Resolved See government 8/3 memo, comments 25 – 31. Based on earlier decision to model latex collection costs as “marginal” (or “incremental”) to oil-based paint collection, government believes that education costs are marginal to a nationally-coordinated oil paint collection (and outreach) effort. This applies to all collection (including pure method 6). Industry says “no additional comments” 8/23. 9/6 Dave D. agrees. Current Status ERG moving forward with assumption that education costs are marginal to a nationally-coordinated oil paint collection (and outreach) effort. 8