vvEPA
United States
Environmental Protection
Agency
Office of Policy
Planning and Evaluation
Washington DC 20460
Reducing Lead
in Drinking Water:
A Benefit Analysis
December 1986
Draft Final Report
EPA-230-09-86-019
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REDUCING LEAD IN DRINKING WATER:
A BENEFIT ANALYSIS
Ronnie Levin
Office of Policy, Planning and Evaluation
U.S. Environmental Protection Agency
EPA-230-09-86-019
Draft Final Report
December 1986
U,5. Environmental Pretcctwn
rtegion 5, Library (PL-12J)
77 West Jackson Boulevard, 12th Fta*
Chicago, II 60604-3590
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SUMMARY
The Safe Drinking Water Act (SDWA), passed by the U.S.
Congress in 1974, requires the U.S. Environmental Protection
Agency (EPA) to protect public health by setting drinking water
standards for public water supplies.* Two levels of protection
are described in the SDWA. Primary drinking water regulations,
applicable only to public water systems, control contamination
that may have an adverse effect on human health by setting
either a maximum contaminant level (MCL) or a treatment technique
requirement. Secondary drinking water standards are non-enforce-
able recommendations concerning the aesthetic quality of drinking
water, e.g., taste or smell.
The National Primary Drinking Water Regulations (NPDWR)
were first promulgated at the end of 1975. EPA revises those
regulations by setting maximum contaminant level goals (MCLGs)
and related MCLs. MCLGs are non-enforceable health-based goals,
intended to protect against known or anticipated adverse health
effects, with an adequate margin of safety. MCLs are enforceable
limits, to be set as close as feasible to the MCLG; feasibility
includes cost and technological constraints. MCLs are proposed
at the same time as the MCLGs.
On November 13, 1985, EPA proposed National Primary Drinking
Water Regulations (NPDWR) to set MCLGs for 28 synthetic organic
chemicals, 11 inorganic chemicals, and 4 microbiological parameters
* Defined in the Act as water systems serving 25 or more people
or having at least 15 service connections.
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in drinking water; these substances are listed in Table 1. The
proposed MCLGs for probable human carcinogens were set at zero, and
MCLGs for other substances were based upon chronic toxicity and
other data.
Lead is included among the inorganic substances proposed for
regulation in the NPDWR. The current MCL for lead is 50 micrograms
of lead per liter of drinking water (ug/1);* the proposed MCLG is
20 ug/1.
The 1986 Amendments to the Safe Drinking Water Act contain a
provision banning the use of materials containing lead in public
water supplies and in residences connected to public water supplies.
States have until June 1988 to begin enforcing this ban.
A. Summary of Study
This analysis estimates some of the benefits that could result
from reducing exposure to lead in community drinking water supplies.
These benefits are probably much greater than those attributable to
just reducing the MCL for lead, but do reflect benefits attainable
with reduced exposure to lead through changes in the MCL coupled
with changes in EPA's monitoring requirements or other efforts to
reduce exposure to lead from drinking water.
There are two primary categories of benefits evaluated in
this paper: the public health benefits of reduced lead exposure
* This is equivalent to and can be stated alternatively as 0.05
milligrams per liter (mg/1), 0.05 micrograms/gram (ug/g), or
50 parts per billion (ppb).
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TABLE 1. Substances Included in-the 1985 Proposed National
Primary Drinking Water Regulations (Maximum Contaminant
Level Goals)
A. Synthetic Organic Chemicals
1. Acrylanide 13.
2. Alachlor 14.
3. Aldicarb, Aldicarb sulfoxide and
Aldicarb sulfone 15.
4. Carbofuran 16.
5. Chlordane 17.
6. Dibronochloropropane * 18.
7. o-,m-Dichlorobenzene 19.
8. cis- and trans-1,2 Dichloroethylenes 20.
9. 1,2-Dichloropropane 21.
10'. 2,4-D . 22.
11. Epichlorohydrin 23.
12. Ethylbenzene 24.
B. Inorganic Chemicals
1. Arsenic
2. Asbestos
3. Barium
4. Cadmium
5. Chromium
6. Copper
' 7. Lead
8. Mercury
9. Nitrate and Nitrite
10. Seleniun
C. Microbiological Parameters
1. Total Coliform Bacteria
2. Turbidity
3. Giardia
4. Pathogenic Viruses
Ethyl ene dibromide
Heptachlor and Heptachlor
epoxide
Lindane
Methoxychlor
Monochlorobenzene
Polychlorinated biphenyls
Pentac hlorophenol
Styrene
Toluene
Toxaphene
2,4,5-TP
Xylene
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and reduced materials, damages relating to the phenomenon of lead's
presence in drinking water as a corrosion by-product. In addi-
tion, because the calculation of health benefits depends on the
extent of human exposure, another section presents the available
data on the occurrence of lead in public water supplies, and
presents estimates of the population exposed to drinking water
exceeding the proposed MCLG of 20 ug/1. In assessing the benefits
of the proposed reduced lead standard, this analysis assumes that
EPA will act to reduce lead levels in tap water, as well as main-
taining the current high guality of water leaving the treatment
plant. It also relies upon and is sensitive to assumptions about
drinking water use and consumption patterns.
This analysis estimates the annual benefits for one sample
year, 1988, of lowering the amount of lead permitted from; 50 ug/1
*
to 20 ug/1. That one year was chosen because environmental lead
levels will have stabilized following EPA's 1984 phasedown of lead
in gasoline.*
For comparability, all monetary values are expressed in
constant 1985 dollars.** The population baseline is the 219.2
million people served by community water systems.
* Specifically, this analysis measures effects given the condi-
tions on January 1, 1988, when EPA's proposed ban on leaded
gasoline will not yet have taken effect. However, even if EPA
promulgates that ban, the estimates in this report will not
change significantly.
** The 1986 Economic Report of the President to Congress {Table B-4)
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1. The Occurrence of Lead in Public Drinking Water
Lead occurs in drinking water primarily as a corrosion
by-product; its sources are the materials used in the distri-
bution and residential plumbing systems (cf sources as diverse
as the EPA Air Quality Criteria Document for Lead, 1986; Craun
and McCabe, 1975; Kuch and Wagner, 1983; Lead in (British) Drinking
Water, 1977; etc). Water leaving the water treatment plant is
usually relatively lead-free. However, pipes and solder
containing lead are corroded by water, and lead levels at the
user tap can be much higher than those found at the treatment
plant. While the presence of lead service pipes and mains is
relatively restricted geographically in the United States, the
use of lead solder (and flux) is ubiquitous. And the combination
of copper pipes with solder containing lead found in most house-
holds can result in high lead levels* in first drawn water that
has been in contact with the pipe for a period of time levels
exceeding the current MCL, even with fairly non-corrosive waters
(e.g., Nielson, 1976). In particular, newly-installed solder is
easily dissolved, and people l-iving in new housing, or in older
housing but with new plumbing, are especially at risk of high
levels of lead in the drinking water (Sharrett et al., 1982;
Murrell, 1985). In general, lead concentrations in fully flushed
water typical of distribution system water, even under corrosive
* This results from galvanic corrosion, which is the corrosion
that occurs when 2 metals, with different electro-chemical
potential, are in the same environment.
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conditions and with new solder, are generally below 50 ug/1 and
usually below 20 ug/1.
Because lead occurs generally as a corrosion by-product in
U.S. community water supplies, levels in fully-flushed water and in
distribution water are typically low. Exposure to lead, however,
is from tap water that can contain significant amounts of lead.
The estimate of occurrence, therefore, is based upon data collected
and analyzed for EPA's Office of Drinking Water in 1979-81. These
data portray partly flushed (30 seconds), kitchen tap samples
collected by the Culligan water-softening company;* J. Patterson
of the Illinois Institute of Technology analyzed the data. Current
evidence indicates that these samples are more representative of
consumed water than are the fully-flushed samples taken in compli-
ance with EPA's monitoring regulations. The Culligan data indicate
that 16 percent of partly flushed water samples could exceed an
MCL of 20 ug/1 at the kitchen tap. The findings from this data
source are consistent with other analyses of the occurrence of
lead in tap water and with studies of lead leaching rates in
corrosive and non-corrosive waters.
To this must be added the inhabitants of housing built within
the past 24 months and that have plumbing materials containing lead
Many studies have shown that new solder can release significant
amounts of lead into water, even exceeding the current MCL of 50
ug/1 (e.g., Sharrett et al., 1982; Internal Corrosion of Water
* The use of company names and the presentation of related data
does not constitute endorsement of their services.
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Distribution Systems, 1985). While corrosive waters have the
highest lead levels, relatively non-corrosive waters can' also
leach significant amounts of lead. The highest lead contamination
levels occur with the newest solder (i.e., during the first 24
months following installation), but those levels decline and are
generally not elevated beyond five years (e.g., Sharrett et al.,
1982; Lassovszky, 1984).
There were 1.7 million new housing starts and permits in the
United States during 1983 and 1.8 million in 1984.* Construction
data show that housing'typically takes six months to a year from
permit to potential occupancy, so there are currently about 3.5
million new housing units (i.e., < 24 months). The Statistical '
Abstract of the United States (1985) indicates that the average
.household contains 2.73 individuals (Table 58). Multiplied
together, a total of 9.6 million people currently live in new
housing.
However, not all of these people are served by community water
supplies: of the current (1985) U.S. residential population of
over 240 million, 219.2 million are served by community water
systems and this analysis only addresses that population. In
addition, data from the plumbing supply industry show that about
8 percent** of new plumbing is plastic, so 92 percent of the
* Survey of Current Business, U.S. Department of Commerce -
Bureau of Economic Analysis, 1985; Table on New Housing
Construction.
** This is the average of claims by the Plastic Pipe Institute
presented in Mruk (1984) and of the Copper Development
Association presented in Anderson (1984).
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8
population has metal pipes. Therefore, the number of people at
risk of high lead levels from new solder in new housing is:
219 mil
9.6 mil x 240 x .92 = 8.1 million.
To calculate the risk to inhabitants of older housing, subtract
the number in new housing (8.8 million)* from the total served by
community water systems (219.2 million); that indicates that 210.4
million people live in older homes. Based upon the Culligan data,
16 percent of them (33.7 million) are at-risk of high lead levels
from partly flushed water at the kitchen tap. Combining the data
from Culligan on lead levels in older housing with the new housing
exposure estimates indicated that 41.8 million people using public
water supplies currently may be exposed to some water that exceeds
the proposed MCL of 20 ug/1; we round this to 42 million..
This may be a low estimate
0 because it does not include the potential exposure
of occupants in housing built within the past 2-5 years
(who also probably remain at greater risk of elevated
lead levels);**
0 because we have not included those who, while living
in older housing, have recently had major plumbing
repairs and so are also at risk of the potentially high
lead levels associated with newly installed solder;
0 because the Culligan data represent water that is
harder than average, whereas high lead levels are
often found with soft waters; and
219 mil
* Derived: 9.6 mil x 240 = 8.8 million people.
** Inhabitants of 2-5 year old housing are not included in this
analysis because it was not possible to eliminate them from the
base and thus avoid double-counting.
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0 because the data used are for partially flushed
samples, while some people (especially children)
may consume water that is closer to first-flush
or standing samples (which is more likely to
contain higher concentrations of lead).*
In addition, we have not included any data from the estimated
60 million people served wholly or in part by private and non-
community water supplies.
There are uncertainties, however, concerning actual patterns
of drinking water use and the extent of plastic piping in new
construction that would reduce the estimate. Early enforcement
of the Safe Drinking Water Act ban on the use of materials
containing lead in public water supplies, enforceable in June
1988, could also decrease exposure to lead from drinking water.
The assumptions on the relationship between water lead levels
and blood lead levels are taken from the draft (EPA) Water Criteria
Document for Lead (1985), which is based upon the recommendations
in the Air Quality Criteria Document for Lead (1986). Those
documents assume a linear relationship, at least at the lower blood
lead levels typical of the United States, with different constants
for children and adults. Those formulae are:
(for children)t pbB** = 0.16*** x intake of lead from water
(for adults) PbB** = 0.06*** x intake of lead from water.
* Water standing in pipes has a greater opportunity for lead to
leach into it and, therefore, is more likely to contain higher
lead levels.
** PbB = blood lead level
*** These constants have a unit of micrograms-of-lead/deciliter-of-
blood per microgram-of-lead-in-water/day, or ug/dl per ug/day.
t This formula was derived from Ryu, 1983. An alternative
estimate from the data in that paper suggests a coefficient of
about 0.4.
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Alternative assumptions (e.g., those reasonably derived from the
results of Richards and Moore,' 1982 and 1984) could imply that
exposure and consequently benefits may be underestimated,
possibly by several factors.
The estimates of the health benefits associated with this pro-
posed rule rely on data on the distribution of blood lead levels in
children and adults collected as part of the Second (U.S.) National
Health and Nutrition Examination Survey (NHANES II), a 10,000
person representative sample of the U.S. non-institutionalized
population, aged 6 months to 74 years. That data base is available
from the (U.S.) National Center for Health Statistics and analyses
of lead-related data from it have been published before (e.g.,
Annest et al., 1980 and 1982; Mahaffey et al. , 1982; Pirkle and
Annest, 1984).
2. Benefits of Reducing Children's Exposure to Lead
Elevated blood-lead levels have long been associated with
neurotoxicological effects and many other pathological phenomena:
an article on lead's neurotoxicity was published as early as 1839,
on anemia in the early 1930s, on kidney damage in 1862, and on
impaired reproductive function in 1860. As noted in the Air
Quality Criteria Document for Lead (1986), from an historical
perspective,' lead exposure levels considered acceptable for
either occupationally-exposed persons or the general population
have been revised downward steadily as more sophisticated bio-
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11
medical techniques have shown formerly-unrecognized biological
effects, and as concern has increased regarding the medical and
social significance of such effects. In the most recent downward
revision of maximum safe levels for children, the Centers for
Disease Control (CDC) lowered its definition of lead toxicity to
25 micrograms of lead per deciliter of blood (ug/dl, the standard
measure of blood lead level) and 35 ug/dl of free erythrocyte
protoporphyrin (FEP). As evaluated in the Criteria Document
(1986), the present literature shows biological effects as low
as 10 ug/dl (for heme biosynthesis) or 15 ug/dl (for certain
renal system effects and neurological alterations); indeed, a
threshold has not yet been found for some effects (e.g., elevated
levels of a potential neurotoxin* or stature effects, Angle et
al., 1982; Schwartz et al., 1986).
There is no convincing evidence that lead has any beneficial
biological effect in humans (Expert Committee on Trace Metal
Essentiality, 1983; and included in the Criteria Document, 1986).
Elevated blood-lead levels have been linked to a wide range
of health effects, with particular concern focusing on young
children. These effects range from relatively subtle changes
in biochemical measurements at 10 ug/dl and below, to severe
retardation and even death at very high levels (80-100 ug/dl).
Lead can interfere with blood-forming processes, vitamin D
metabolism, kidney function, neurological processes and repro-
* ALA, or aminolevulinic acid.
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12
ductive functions in both males and females. In addition, the
negative impact of lead on cognitive performance (as measured by
IQ tests, performance in school, and other means) is generally
accepted at moderate-to-high blood-lead levels (30 to 40 ug/dl
and above), and several studies also provide evidence for possible
attentional and IQ deficits, for instance, at levels as low as
10-15 ug/1. Changes in electroencephalogram readings, as another
example, have also been observed at these low levels. For many
subtle effects, the data may represent the 'limits of detectability
of biochemical or other changes, and not necessarily actual
thresholds for effects.
For children's health effects, two categories of benefits
were estimated monetarily: 1) the avoidance of costs for medical
care for children exceeding the lead toxicity level set by the
Centers for Disease Control (i.e., -25 ug/dl, when combined with
FEP levels of > 35 ug/dl) and 2) the averting of costs due to
lead-induced cognitive effects. Two alternative methods for
valuing the potential cognitive damage resulting from exposure to
lead were developed. The first of these two alternatives involves
assessing the costs of compensatory education to address some of
the manifestations of the cognitive damage caused by lead as a
proxy measure for the damage itself. The second relates to one
specific indication of that cognitive damage -- potential IQ
point loss, and includes a calculation of decreased expected
future earnings as a function of 10 point decrement. These esti-
mates neither include many major categories of pathophysiological
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13
effects (e.g., renal damage), nor do either the medical costs
or the compensatory educatio-n costs consider any lasting damage
no.t reversed by medical treatment or compensatory education. These
estimates also attribute few benefits to reducing lead levels in
children whose blood lead levels would be below 25 ug/dl even in
the absence of the rule.
The estimate, of reductions in medical care expenses rely upon
published recommendations (Piomelli et al., 1984) for follow-up
testing and treatment for children with blood lead levels above 25
ug/dl. The costs of such medical services and treatment were
estimated at about $950 per child over 25 ug/dl (1985 dollars).
This average reflects both lower costs for most of these children
and much higher costs for the smaller subset requiring chelation
therapy.
The estimates for compensatory education assumed three years
of part-time compensatory education (de la Burde and Choate, 1972
and 1975) for 20 percent of the children above 25 ug/dl, averaging
about $2,800 (1985 dollars) per child above that blood lead level
based upon data from the U.S. Department of Education (Kakalik
et al., 1981) .
There is extensive literature examining the relationships
between IQ, educational levels attained, demographic variables and
earnings (ICF, 1984). The results of that literature were used to
estimate the effect of 10 point losses that can occur as a part of
the cognitive damage caused by lead exposure upon expected future
earnings: one 10 point can directly and indirectly affect earnings
by 0.9 percent. The studies of cognitive damage presented in
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the Air Quality Criteria Document for Lead (U.S. EPA, 1986) show
evidence that blood lead levels of 15-30 ug/dl can be associated
with IQ losses of 1-2 points, blood lead levels of 30-50 ug/dl
can be associated with IQ losses of 4 points, and over 50 ug/dl of
blood lead can correlate with losses of 5 points. Data from the
Census Bureau on expected future lifetime earnings, deferred for 20
years* at a 5 percent real discount rate and then annualized, yield
estimated benefits of avoided damage from reduced exposure to lead.
This alternative method for valuing some of lead's cognitive damage
indicated that society could save $1,040 per child brought below 15
ug/dl; $2,600 per child brought below 30 ug/dl; and $2,850 per
child brought below 50 ug/dl by reducing lead in drinking water
(1985 dollars).
In sum, this analysis indicates that the proposed rule could
produce benefits of $27.6 million annually in avoided medical
expenses; $81.2 million per year in reduced compensatory education
costs; and $268.1 million per year in increased lifetime earnings,
based upon sample year 1988; these estimates are in 1985 dollars.
Note that compensatory education and affected earnings are alter-
native methods for valuing aspects of the cognitive damage caused
by lead.**
* These costs are deferred because those suffering the effects are
children and will not enter the work force for up to 20 years.
Obviously, using the largest deferral period (20 years) reduces
the value of the benefit and reduces the benefit estimate,
whereas 8- or 10-year-old children may begin working within 8
years and so would have a much shorter deferral period. This
biases the estimates downward slightly.
** This also biases the results downward because there is a strong
rationale for considering these effects as additive.
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In addition, benefits potentially derived by decreasing the
incidence of two other categories of health effects (lead's adverse
effect upon children's growth and fetal effects) were not estimated
in dollar terms. Assuming that pregnant women are distributed
proportionately throughout the country, data from the Census Bureau*
on birth rates and demographic distributions indicate that 24 per-
cent of the total population is women of child-bearing age (15-44)
and that the birth rate is 67.4 births per 1,000 women aged 15-44.
Therefore,
41.8 million x 24% x 67.4 per thousand =680,000.
It is estimated that this proposed rule could prevent 680,000
fetuses from being exposed to elevated lead levels. The fetal
effects are particularly important, because several recent studies
have shown that lead exposure within the normal range (6-20 ug/1)
can be associated with various negative pregnancy outcomes (such as
early membrane rupture and even miscarriages, e.g., Moore, 1982;
Wibberly et al., 1977), and with low birth weight, inhibited post-
natal growth and development (e.g., Bornschein, 1986; Bellinger,
1985 and 1986; Dietrich et al., 1986). In addition, this proposed
rule could prevent 82,000 children from risk of growth effects.
3. Blood-Pressure-Related Benefits and Other Adult Health Effects
Lead has long been associated with elevated blood pressure, but
until recently most of the studies have focused only on hyperten-
sion and relatively high lead levels typically found only in those
occupationally exposed to lead. Several recent studies, however
Statistical Abstracts (1986), Tables 27 and 82.
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(e.g., Pirkle et al., 1985? Harlan et al., 1985; Pocock, 1984 and
1985), have found a continuous relationship between blood lead and
blood pressure. These studies provide evidence for a small (com-
pared to other risk factors) but robust relationship after control-
ling for numerous other factors known to be associated with blood
pressure. Experimental animal studies in several species of rats
and pigeons also provide evidence of a relationship between
moderate blood-lead levels and increases in blood pressure.
To calculate these benefits, logistic regression equations
were used to predict how reducing exposure to lead in drinking
water would affect the number of hypertensives in the U.S. popu-
lation. These estimates cover only males aged 40 to 59, because
the effect of lead on b.lood pressure appears to be stronger for men
and because the correlation between blood pressure and age is much
smaller in this age range, reducing the potential for confounding
due to the correlation between blood lead and age. The estimates
rely upon 1) site-adjusted coefficients from analyses of the MHANES
II data relating blood lead levels to increases in blood pressure*
and 2) coefficients relating blood pressure increases to more serious
cardiovascular disease outcomes, based on data from the Framingham
Study (McGee et al., 1976) and Pooling Project (1976), as confirmed
by Levy et al., 1984.
Levy has demonstrated that the risk coefficients from the
Framingham Heart Study, when coupled with the observed reductions
in blood pressure, smoking, and cholesterol in the U.S. population
* The specific coefficients and the basis for their derivation are
described in the Addendum to the Criteria Document, 1986, which
is included in volume 1 of that publication.
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during the 1970s, correctly predicts the observed reductions in
cardiovascular mortality in the overall population during that
decade. The Pooling Project showed that the Framingham coefficients
adequately predicted cardiovascular outcomes (such as strokes and
heart attacks) in the other five large prospective heart studies
performed in the U.S. Therefore, while caution is clearly warranted
in view of the limited data on the effect of lowering blood lead
levels on blood pressure, use of the regression coefficients from
the Framingham Study provide a reasonable basis by which to predict
potential changes in cardiovascular outcomes associated with blood
pressure changes due to decreased lead exposure.
Based upon this information, reducing exposure to lead from
drinking water in 1988 could reduce the number of male hypertensives
(aged 40 to 59) by 130,000. Using estimates of the costs of medical
care, medication, and lost wages, such a reduction in hypertension
incidence would yield a value of $250 per year per case avoided (1985
dollars).
These estimates of how blood pressure reductions would affect
the incidences of various cardiovascular diseases were based on
projections of changes in blood pressure as a result of the proposed
rule and estimates of the relationships between blood pressure and
heart attacks, strokes, and deaths from all causes. As noted
earlier, the latter estimates were derived from several large
epidemiological studies, primarily the Framingham study. However,
because those studies included very few nonwhites, the estimates
were further restricted to white males, aged 40 to 59. Thus, the
benefits estimates do not include middle-aged, nonwhite males.
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The basis of .most of the medical costs are the cost-of-illness
estimates presented in Hartunian et al., 1981, which were adjusted
in three ways to reflect current conditions. First, we inflated
them to 1985 dollars using data from the 1986 Economic Report of
the President to Congress. Second, we adjusted the costs to reflect
changes and improvements in medical treatment, including the trip-
ling in the incidence rate of. coronary bypass operations that
occurred between 1975 and 1982. Third, Hartunian used a 6 percent
real discount rate to present-value future expenditures, while
this analysis uses a 10 percent real discount rate.
The value of reductions in heart attacks and strokes was based
on the cost of medical care and lost wages for nonfatal cases.
Expected fatalities from heart attacks and strokes were included
in the-estimate of deaths from all causes. That procedure yielded
benefits of $65,000 per heart attack avoided and $48,000 per stroke
avoided (1985 dollars) for the 240 heart attacks and 80 strokes
estimated to likely be avoided in 1988 because of this proposed
rule. It is important to note that these estimates do not account
for any reductions in the quality of life for the victims of heart
attacks and strokes (e.g., the partial paralysis that afflicts
many stroke victims).
Valuing reductions in the risk of death is difficult and con-
troversial, with a wide range of estimates in the literature.
EPA's policy guidelines (U.S. EPA, 1984), for example, suggest a
range of $400,000 to $7 million per statistical life saved. Using
$1 million per case, the benefits of reduced mortality dominate our
estimates of total blood-pressure-related benefits; these total
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$240 million in 1988 for the 240 deaths estimated as likely to
be avoided in that year. Altogether, the monetized benefits of
reducing adult male exposure to lead in drinking water are
estimated to total $291.9 million per year (in 1985 dollars),
using 1988 as a sample year.
In addition, because lead crosses the placental barrier and is
a fetotoxin, pregnant women exposed to lead are at risk of compli-
cations in their pregnancies and damage to the fetus. (Fetal
effects are discussed above, under children's health effects.)
While we have not monetized any of these reproductive effects, as
noted above, 680,000 pregnant women per year probably receive
water that exceeds the proposed standard of 20 ug/1, and would
benefit from the proposed rule. Lead-induced effects on male
reproductive functions have also been discussed in the scientific
literature but are not included in this report.
4. Benefits of Reduced Materials Damage
A third category of monetized benefits relates to the phenom-
enon of lead's presence in drinking water: it is a product of the
corrosive action of water upon the materials of the distribution
and residential plumbing. For the most part, therefore, treatment
processes used to reduce high levels of lead in drinking water are
the same as treatment processes used to reduce the corrosion poten-
tial of the water. Reducing corrosion damage will produce substan-
tial benefits to water utilities, their rate-paying customers, and
building owners.
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Published estimates of the costs of corrosion damage range
from $12 to $46 per person per year (1985 dollars), and are sum-
marized in Table 2. Estimates of the costs that can be avoided by
corrosion control measures range from 20-50 percent of total
damage. The point estimate of avoidable corrosion costs (i.e., the
benefits of corrosion control) is $8.50 per capita annually (1985
dollars). For comparison, estimates of average corrosion treatment
costs range from under $1 per person per year (based upon the
experience in Boston and Seattle, cities currently treating their
highly corrosive waters) to almost $5 per person per year (based
upon the highest treatment costs presented in the ODW cost
report).* As a point estimate, we assumed per capita annual treat-
ment costs of $3.80 (1985 dollars).
Estimates of the extent of corrosive water also vary. A
commonly accepted profile is that developed by the U.S. Geological
Survey in the early 1960s, which identified the Northeast,
Southeast, and Northwest sections of the country as having the
softest and most corrosive waters (Durfor and Becker, 1964a and
1964b). The combined populations of those states are 67.7 million
people (1980 census). Assuming that these areas are served
proportionately by community water systems,** 61.8 million people
* The range, however, is quite wide and highly sensitive to system
size. These represent average costs. In some very small
systems (i.e., serving 25-100 people), costs may be many times
higher
** Of the total population of about 240 million, 219.2 million
people are served by community water systems.
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TABLE 2. Estimates of Annual Per Capita Corrosion Damage (1985 dollars)
Studies
Kennedy Engineers
(1973)
Hudson & Gilcreas
(1976)
Kennedy Engineers
(1978)
Bennett et al.
(1979)
(cited in Ryder,
1980)
Energy & Environ-
mental Analysis
(1979)
Ryder (1980)
Kirmeyer & Logsdon
(1983)
Estimated Annual Corrosion Damage
(per capita)
Distribution
Systems
$5.57
$8.68*
$9.40
$3.98
$1.17
L
Residential
$30.87*
$7.97
$22.19
$23.60*
Total
$16.71*.
$26.04*
$46.30*
$28.20*
$11.95
$23.36
$35.40*
Corrosion
Damage
Avoidable
Through
Water
Treatment
30%*
50%
20%
20%
38%
25%
40%
Annual Per
Capita Benefits
of Corrosion
Control
$5.01*
$13.02*
$9.26*
$5.64*
$4.54
$5.84
$14.16*
AVERAGE $8.21
W/OUT EEA $8.82
Assumpt ions/Notes
Assumed 30% potential reduction
in corrosion damage and that dis-
tribution costs were one-third of
total costs.
They did not include increased
operating costs. Per capita
estimate assumes 200 million
people are served by public water
systems. Assumed that distri-
bution costs were one-third of
total costs.
They calculated $6.17 per capita
in savings to residence owners.
Assumed residential costs were
two- thirds of total costs.
Assumed that 200 million people
are served by public water systems
and that distribution costs were
one- third of total costs.
This is an admitted underestimate:
it includes only damage to pipes
(not damage to water heaters,
increased operating costs, etc.)
Ryder ascribed 95% of corrosion
damage to private owners.
Assumed residential costs were
two- thirds of total damage.
These estimates have been calculated by the authors of this paper. Assumptions are noted above.
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22
would benefit from actions to reduce the corrosivity of their water,
That figure, multiplied by $8.50 per person, yields annual benefits
from reduced corrosivity of $525.3 million (1985dollars).
5. Summary of Benefits of Reduced Lead in Drinking Water
This analysis of the benefits of reducing exposure to lead
in drinking water indicates that the monetized annual benefits
could range from $926.0 to $1,112.9 million (1985 dollars) for
sample year 1988. In addition, there are numerous health benefits
of reduced exposure to lead that are not monetized. The annual
monetized benefits are summarized in Table 3, and the non-monetized
benefits are presented in Table 4.
Based upon the latest cost "estimates used by the Office of
Drinking Water* the projected benefits exceed the costs' by about
4:1. Expressed differently, lowering the MCL to 20 ug/1 could
produce annual net benefits of about $800 million in 1988.
It should be emphasized that considerable uncertainty is
associated with these estimated benefits, uncertainties derived
both from the current state of knowledge concerning lead health
effects and the valuation of avoiding such effects. Other
analogous efforts to estimate benefits associated with reducing
lead in drinking water may be useful in helping to judge how
reasonable these present benefit estimates are.
* These calculations use preliminary EPA Office of Drinking
Water cost estimates. Costs and net benefits will be
discussed more extensively in other documents associated
with this proposed rulemaking.
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23
TABLE 3. Summary of Estimated Annual Monetized Benefits of Reducing Exposure
to Lead from 50 ug/1 to 20 ug/1 (1985 dollars) for Sample Year 1988
Estimated population exposed to drinking
water exceeding proposed MCL
42 million*
Children's health benefits
-reduced medical costs
-reduced costs of cognitive damage
Method 1 - compensatory education
Method 2 - decreased future earnings
TOTAL:
Method 1
Method"2
$27.6 million
$81.2 million
$268.1 million
$108.8 million
$295.7 million
Adult health benefits (males only)
-reduced hypertension savings
(males, aged 40-59)
-savings fron fewer heart attacks
(white males, aged 40-59)
-savings from fewer strpkes
(white males, aged 40-59)
-savings from fewer deaths
(white males, aged 40-59)
TOTAL:
Materials benefits
-benefits of reduced corrosion damage
$32.5 million
$15.6 million
$3.8 million
$240.0 million
$291.9 million
$525.3 million
TOTAL ANNUAL MONETIZED BENEFITS
-Method 1 - using compensatory education
-Method 2 - using decreased future earnings
ESTIMATED ANNUAL COSTS
NET ANNUAL MONETIZED BENEFITS
$926.0 million
$1,112.9 million
$230.0 million
about $800 million
* Total population served by conmunity water systems: 219 million
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24
TABLE 4. Summary of Estimated Annual Non-monetized Benefits of Reducing
Exposure to Lead from 50 ug/1 to 20 ug/1 for Sample Year 1988
Estimated population exposed to drinking
water exceeding proposed MCL
Children's health benefits
- children requiring medical treatment
- loss of 1-2 IQ points
4 IQ points
5 IQ points
- children requiring compensatory education
- children at risk of stature decrement
- fetuses at risk
- increased risk of hematological effects
Reductions in Nunfoers
of People at Risk
42 million*
29,000
230,000
11,000
100
29,000
82,000
680,000
82,40.0
Adult health benefits
-cases of hypertension
(males, aged 40-59)
-heart attacks
(white males, aged 40-59)
-strokes
(white males, aged 40-59)
-deaths
(white males, aged 40-59)
-(reduced risk to pregnant women
((women, aged 15-44)
(same as fetuses
-reduced risk of reproductive effects
(women, aged 15-44)
130,000
240
80
240
680,000)
)
)
34,000
* Total population served by community water systems: 219 million
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25
B. Boston Case Study
In the spring of 1986, Jonathan Jacobson analyzed the incre-
*
mental costs and benefits to the City of Boston of reducing the
lead MCL from 50 ug/1 to 10 ug/1.* That analysis, carried out as a
masters thesis project at Harvard University, focused on Boston as
a city with high potential for increased lead exposure via drinking
water.
Boston's water is highly corrosive: it is.relatively acidic
(pH = 6.7) and soft (14 mg/1 of CaCC>3), and has low alkalinity
(Karalekas et al., 1975). Boston also has a large percentage of
lead pipes in service. During the 1970s, several studies found
high lead levels in Boston's drinking water (e.g., Karalekas et
al., 1975; and several internal studies conducted by the
Massachusetts Water Resources Authority and the [Boston]
Metropolitan District Commission).
To reduce the high lead levels, 'Boston began corrosion
control treatment. Monitoring performed by EPA's Region I from
1975 to 1981 indicated that lead, iron and copper levels dropped
significantly (Karalekas et al., 1982). However, while lead
concentrations generally decreased to below the current MCL of
50 ug/1, additional treatment will be necessary to comply with
a lowered MCL.
Jacobson analyzed the incremental annual costs and benefits
of additional efforts by Boston to control further the corrosivity
* He assumed a lowered MCL of 10 ug/1 because that is the
feasibility limit for current treatment and technology.
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26
of its water, using sample years 1988 and 1992, and estimating all
costs in 1985 dollars. His analysis assumed the following:
compliance will be measured by a standing "grab" sample,
that is, a sample taken immediately after turning on
the faucet at any random time during the day after an
unknown period of standing;
0 it will be impossible for every tap to meet the lowered
MCL, even using state-of-the-art treatment, and so
samples should be averaged; and
that, while the effectiveness of specific treatment
procedures varies in not-yet-well-understood ways when
actually used in the field,- corrosion control is ulti-
mately feasible with current state-of-the-art methods.
Jacobson, using data from EPA Region I and the Massachusetts
Water Resources Authority, calculated the benefits of additional
2-stage treatment for Boston's water: further raising the pH (to
reduce the acidity of the water) and installing several pumping -
stations to maintain a consistent concentration of sodium hydroxide
throughout the system.
Jacobson used the same categories of monetized health benefits*
as those described in this EPA analysis, except that he did
not include the estimates of cognitive damage associated with
decreased future earnings. His estimates of materials benefits
rely only upon the Kennedy Engineers (1978) study and information
in the American Water Works Association Corrosion Manual (1985).
His results, summarized in pages 36-39 of his study, indicate
incremental costs of $700,000 per year (using sample year 1988) and
incremental annual benefits of $7.9 million (including estimated
* For blood-pressure-related estimates, however, he used the non-
site-adjusted coefficients from the NHANES II contained in
Pirkle et al., 1985.
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27
health benefits of '$6.9 million and materials benefits of
$950,000; based upon sample year 1988). This yields estimated
net annual benefits of $7.2 million and a benefit to cost ratio
of 11:1 (compared to the estimate of 4:1 in this analysis).
It is unclear, however, whether or how these results can be
extrapolated to other U.S. water systems and cities, and
therefore, to this proposed rule.
-------
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