REGULATORY IMPACT ANALYSIS:

 PROTECTION OF STRATOSPHERIC OZONE


VOLUME II:  APPENDICES TO REGULATORY
           IMPACT ANALYSIS DOCUMENT


      PART 2:  APPENDICES J-M
            PREPARED BY

  STRATOSPHERIC PROTECTION PROGRAM
   OFFICE OF PROGRAM DEVELOPMENT
    OFFICE OF AIR AND RADIATION
U.S.  ENVIRONMENTAL PROTECTION AGENCY
           AUGUST 1,  1988

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    REGULATORY IMPACT ANALYSIS:

  PROTECTION OF STRATOSPHERIC OZONE
VOLUME II:  APPENDICES TO REGULATORY
            IMPACT ANALYSIS DOCUMENT
       PART 2:  APPENDICES J-M
            PREPARED BY

  STRATOSPHERIC PROTECTION PROGRAM
   OFFICE OF PROGRAM DEVELOPMENT
    OFFICE OF AIR AND RADIATION
U.S.  ENVIRONMENTAL PROTECTION AGENCY
           AUGUST I, 1988

-------

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                                  APPENDIX J

                      SUMMARY OF CONTROL OPTIONS  SIMULATED
    This appendix presents the control options simulated to be undertaken in the
CFC 50%/Halon Freeze case.  This case is specified to correspond to the major
provisions of the Montreal Protocol (see Chapter 5 for a description of the
case).   The method used to simulate the implementation of the control options is
presented in Appendix I.  Each of the control options and applications is
described in the addenda in Volume III.

    The control options simulated to be undertaken are listed for the years
1989, 1991, 1993, and 1998.*  For these years the simulated increases in CFC and
halon prices (weighted by ozone-depleting potential) are reported.  As described
in Appendix I, the simulated increases in the compound prices drive the
selection of control options.  The reduction in CFC or halon use simulated by
each control option is also displayed.

    As discussed in Chapter 9, several different sets of assumptions were used
to evaluate costs.  This appendix lists control options simulated for two sets
of cost assumptions.  Case 1 assumes that the implementation of many control
options is delayed, limited, or prevented.  Case 2 assumes that sufficient
information is available for markets to respond efficiently and quickly to
restrictions in the supply of CFCs.

    Control options simulated in Case 1 are summarized first.  Separate lists
are shown for each year.  Options simulated in Case 2 are presented next.  Only
control options for CFCs are shown on the Case 1 and Case 2 lists.  Assumptions
regarding the reductions achieved by halon controls were not varied in the cost
analysis, therefore control options simulated for halon compounds are presented
once following the Case 2 list.

    The following information is presented for each year:

    •   Simulated price increase for the CFCs.  As described in Appendix
        I, the CFCs are simulated to be controlled as a group based on
        each compound's ozone-depleting potential.  Thus, the price
        increase across compounds, weighted for ozone-depleting
        potential, is the same.

    •   Simulated price increases for Halon 1211 and Halon 1301.  The
        two halon compounds are simulated to be controlled together,
        resulting in one ozone-depletion weighted price increase for
        halons.

    •   Control options simulated.  For each application, controls
        simulated to be undertaken in that year are listed.
     1 The engineering studies on which the cost analysis was based described
control options available in the next ten years.  Thus, there is little
variation in the control options simulated after 1998.

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                                      J-2
        Applications for which no controls are simulated do not appear
        on the lists.

    •   Weighted trigger price and social costs.  For each control
        simulated, the weighted trigger price and weighted social cost
        are reported.  The trigger price indicates the increase in the
        CFG or halon price (weighted for ozone-depleting potential)
        required before the control option would be profitable to be
        undertaken.  The social cost indicates the real resource costs
        to society of undertaking the action, expressed per kilogram of
        CFC or halon reduced.^

    •   Reduction in CFC or halon use achieved by control option.  For
        each control option simulated, the reduction in CFC or halon use
        achieved by the control is shown.  Simulated reductions are
        reported as a percentage of:  (1) compound use in the
        application, (2) total use of the relevant CFC or halon
        compound, and (3) aggregate weighted CFC or halon use across all
        compounds.

    In Case 2 there is no price increase simulated for the CFCs in 1989.
Nevertheless, reductions in CFC use are required and actions are simulated to be
undertaken.  All of the options shown have negative or zero switch prices,
indicating that the data in the addenda imply that it is less expensive to adopt
these options than to continue to use CFCs.

    For example, in 1989 the Conveyorized Vapor Degreasing application has
aqueous cleaning and terpenes simulated.  The switch price for this option is
negative.  Switching to aqueous cleaning and terpenes is simulated to reduce
CFC-113 use by 20 percent in Case 2, representing a 1.4 percent decline in
aggregated weighted CFC use for all CFC compounds.

    After 1991 there are simulated increases in CFC prices in Case 2.  Positive
price increases occur in all years in Case 1.  In these years control options
with positive switch prices and social costs are listed.

    The summary lists illustrate the impact of time on the cost analysis.  After
1989,  additional options are simulated to become available.  Also, the compound
reductions that can be achieved by each option are simulated to increase over
time as information about the options becomes available and technical
constraints are overcome.  For example,  in Case 2 the aqueous cleaning and
terpenes control in conveyorized vapor degreasing achieves 20 percent reduction
in 1989 but 40 percent by 1991.

    The control options listed in this appendix reflect the substantial
revisions made to the cost analysis since the publication of the original
Regulatory Impact Analysis (RIA) in December 1987.  The analysis has benefitted
from additional information obtained during industry meetings and from comments
received on the original RIA.  Revisions to the control options simulated in the
cost analysis are described in Part 10 of Volume III of this RIA.
     2 In the evaluation of costs presented in Chapter 9,  all negative social
costs were set to zero.

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                                      J-3
   •Some options included in the original RIA were dropped from this cost
analysis.  Examples include CFC-132b (a potential chemical substitute for CFC-
113 in solvent applications),  carbon dioxide (replaces CFC-12 in sterilization,
commonly referred to as "10/90"), and certain innovative product substitutes for
CFC-blown foam applications.  The costs of other control options were revised.
Examples of revised options include modified polyol systems in flexible
slabstock foams and aqueous cleaning in solvent applications.

    The cost analysis now also includes new control options identified since the
original RIA.  For example, options were added to replace CFC-113 in solvent
applications, including CFC-113 azeotropes (mixtures of CFC-113 with non-ozone
depleting compounds) and terpene-based chemical substitutes.  HCFC-22, recently
approved by the U.S. Food and Drug Administration for use in certain food
packaging applications, also has been added as an option in CFC-blown packaging
foams.

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CASE 1 -- 1989

-------
 Control Options Simulated
 Year:              1989
 Cost Curve:        Case 1
 Use Scenario:      Middle Growth
 Regulatory Option: CFC SOX/Halon Freeze
 Simulated CFC Price Increase: $ 6.69
          Application


 Aerosol Propellent
 Aerosol Propellant

 Centrif Chillers (CFC-IK)

 Centrif Chillers (CFC-11)

 Centrif Chillers (CFC-12)
 Centrif Chillers (CFC-12)
                    Control Option
 Carbon Dioxide
 HCFC-22 Blends
 Recovery at Service and Disposal

 Recovery at Service and Disposal

 Recovery at Service and Disposal
 Alt Leak Test Gas
 Centrif Chillers (CFC-500)   Recovery at  Service and Disposal
 Cnvyrzd Vapor Degreasing
 Cnvyrzd Vapor Degreasing
 Cnvyrzd Vapor Degreasing
 Cnvyrzd Vapor Degreasing

 Cold Cleaning
 Cold Cleaning
 Cold Cleaning
 Cold Cleaning
 Cold Cleaning
 Cold Cleaning
 Cold Cleaning

 Cold Storage  (CFC-12)
 Cold Storage  (CFC-12)
 Cold Storage  (CFC-12)

 Cold Storage  (CFC-502)
 Cold Storage  (CFC-502)

 Commercial R&O Labs
 Commercial R&O Labs

 Contract Sterilization
 Contract Sterilization
 Contract Sterilization

 Dehunidifiers

 Dry Cleaning
Dry Cleaning
 Dry Cleaning

 Ext PS Bdstk
 Aqueous Cleaning and Terpenes
 Reclaim Waste Solvent
 CFC-113 Azeotropes
 Housekeeping Controls

 Petroleum Solvents
 Methyl  Chloroform
 Cover;  Drainage;  & Increased  Freeboard
 Reclaim Waste Solvent
 CFC-113 Azeotropes
 Housekeeping Controls
 Aqueous Cleaning  and Terpenes

 HCFC-22
 Alt  Leak Test Gas
 CFC-502

 HCFC-22
 Alt  Leak Test  Gas

 N2 Purge then Pure EO
 Contract Out

 Explosion Proof Condensation/Reclamation
 N2 Purge then Pure EO
 Acid-H20 Scrubber & Condensation/Reclamation

 Recovery at Rework

 Refrigerated Condenser
Aqueous Cleaning
Methyl Chloroform

HCFC-22
 Weighted   Weighted   Reduction  Reduction
  Trigger    Social     in CFC Use  in Total
   Price      Cost         for
(1985S/kg) (19B5$/kg)  Application
                                                                                                                                       Reduction  in Compound Use
     -0.74
      2.21

      0.47

      1.60

      0.74
      1.26

     -0.47
     0.73

    -2.64
    -0.64
     6.69

     0.88
 -0.74
  2.21

  0.26

  1.22

  0.56
  1.26

 -0.68
-16.60
-0.36
0.00
0.00
-2.36
-1.34
-0.61
-0.32
0.00
0.00
6.60
0.81
1.26
2.79
-7.19
-7.13
-0.27
0.00
-2.34
-0.36
-0.17
-17.20
-0.36
0.00
0.00
-2.36
-1.34
-0.64
-0.32
0.00
0.00
6.17
0.81
1.26
2.79
-7.19
-7.13
-0.41
0.00
-2.34
-0.48
-0.62
 0.20

-3.01
-1.14
 4.07

 0.88
ration CFC Use CFC-11 CFC-12 CFC-113 CFC-114 CFC-115
15. OX
25. OX
7.2X
2.3X
2.2X
5.1X
6.1X
9.6X
2.7X
2.6X
10.6X
13. 3X
30. 3X
4.2X
1.6X
2.9X
7.6X
3.8X
5. IX
3. OX
6.7X
6.1X
0.2X
9.6X
6.8X
4.5X
21. 5X
11. IX
1.2X
16. 3X
3.7X
79.9X
0.663X
1.106X
0.026X
0.058X
0.021X
0.047X
0.019X
0.678X
0.191X
0.186X
0.750X
0.229X
0.522X
0.072X
0.027X
0.050X
0.131X
0.066X
0.062X
0.037X
0.081X
0.019X
0.001X
0.005X
0.004X
0.027X
0.127X
0.065X
0.002X
0.085X
0.019X
0.417X
0.86X 0.78X
1.43X 1.30X

0.19X
0.04X
0.09X
0.05X


0.12X
0.07X
0.16X

0.01X
0.01X
0.05X
0.25X
0.13X
O.OOX


1.71X



4.37X
1.23X
1.20X
4.84X
1.48X
3.37X
0.46X
0.17X
0.32X
0.84X
0.43X

3.88X
0.11X



0.55X
0.12X
2.69X
                                                                                                              44.9X    0.616X
                                                                                                           1.21X

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Control Options Simulated
Year:              1989
Cost Curve:        Case 1
Use Scenario:      Middle Growth
Regulatory Option:  CFC SOX/Halon  Freeze
Simulated CFC Price Increase:  $ 6.69
Weighted   Weighted   Reduction  Reduction
 Trigger    Social    in CFC Use  in Total
                                                                                                                                      Reduction in Compound Use
Application
Ext PS Sht
Ext PS Sht
Ext PS Sht
Ext PS Sht
Ext PS Sht
Flex PU Foam-Molded
Flex PU Foam-Slabstock
Freezers
Hospitals
Hospitals
Hospitals
Liquid Food Freezing
Medical Equipment
Medical Equipment
Medical Equipment
Medical Equipment
Mobile Air Conditioners
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
PE Foam
PE Foam
PE Foam
PE Foam
Pharmaceutical
Pharmaceutical
>henolic Foam
'rocess Refrig
_ • • • •»*• Mwa* i «ji Mciynieu
Control option <1985$/kg) (1985$/kg) Application CFC Use
Product Substitutes for Stock Food Trays
Product Substitutes for Egg Cartons
Product Substitutes for Single Service Plates; Cups;
Product Substitutes for Hinged Containers
HCFC-22
MDI-TDI/Uater-Blown Systems in HR Process
Modified Polyol Systems
Recovery at Rework
Disposables
Contract Out
C02 (10/90 EO/C02)
Cryogenic
Explosion Proof Condensation/Reclamation
N2 Purge then Pure EO
Acid-H20 Scrubber & Condensation/Reclamation
Contract Out
Recovery at Service -- Large Shops
Refrigerated Freeboard Chiller
Aqueous Cleaning and Terpenes
Manual Cover; Drainage; Increased Freeboard; & Thermo
CFC-113 Automatic Cover
Reclaim Waste Solvent
CFC-113 Azeotropes
Housekeeping Controls
CFC-113 Automated Hoist
Alternate Packaging Materials
Rubber or Plastic Floatation Devices
Rubber or Plastic Gaskets
HCFC-22
Contract Out
H2 Purge then Pure EO
Other Insulation Materials-Equiv Insul Capacity
Hydrocarbons
0.00
0.00
0.00
0.00
0.39
1.95
5.88
0.07
0.00
0.00
1.55
5.32
-2.31
-0.20
-0.17
0.00
1.84
-11.81
-11.65
-10.40
-1.55
-0.35
0.00
0.00
0.20
-9.87
-9.70
0.00
0.38
0.00
0.28
0.50
-3.29
0.00
0.00
0.00
0.00
0.35
1.19
5.81
-0.50
0.00
0.00
1.17
5.03
-2.31
-0.37
-0.61
0.00
0.73
-12.04
-12.40
-10.75
-1.80
-0.35
0.00
0.00
-0.81
-9.87
-9.90
0.00
0.38
0.00
-0.10
0.50
-3.29
1.3X
0.7X
0.9X
0.5X
89.9X
33. 3X
6.7X
0.9X
6.6X
1.4X
3.7X
10. OX
4. OX
18.0X
3. IX
11. 2X
2.2X
5.8X
9.4X
0.8X
16. 3X
2. OX
3.9X
15. 4X
13. 5X
3.7X
2.9X
1.9X
68. 6X
5.3X
8. OX
12. OX
1.5X
0.038X
0.019X
0.026X
0.014X
2.618X
0.513X
0.357X
0.002X
0.213X
0.045X
0.119X
0.140X
0.059X
0.262X
0.045X
0.164X
0.545X
0.344X
0.558X
0.050X
0.966X
0.120X
0.234X
0.915X
0.798X
0.054X
0.042X
0.027X
0.991X
0.014X
0.022X
0.070X
0.005X
CFC-11 CFC-12 CFC-113
0.07X
0.04X
0.05X
0.03X
5.14X
1.65X
1.15X
O.OOX
0.42X
0.09X
0.23X
0.27X
0.12X
0.52X
0.09X
0.32X
1.07X
2.22X
3.60X
0.32X
6.23X
0.78X
1.51X
5.90X
5.15X
0.05X
0.04X
0.03X
0.97X
0.03X
0.04X
0.13X 0.20X
0.01X
CFC-114 CFC-115










1.77X
1.36X
0.88X
32.43X





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 Control  Options Simulated
 Tear:               1989
 Cost Curve:         Case  1
 Use Scenario:       Middle Growth
 Regulatory Option:  CFC SOX/Halon Freeze
 Simulated CFC Price Increase: $ 6.69
                                                      Weighted   Weighted   Reduction  Reduction
                                                       Trigger    Social    in CFC Use  in Total
                                                                                                                                      Reduction in Compound Use
Application
Process Refrig
Process Refrig
Process Refrig
Reciprocating Chillers
Reciprocating Chillers
Refrigerated Transport
Refrigerated Transport
Refrigerators
Retail Food (CFC- 12)
Retail Food (CFC- 12)
Retail Food (CFC- 12)
Retail Food (CFC- 12)
Retail Food (CFC-502)
Retail Food (CFC-502)
Retail Food (CFC-S02)
Rgd PU Foam-Prd-Cons-Bldg
Rgd PU Foam-Prd-Cons-lnd
Rgd PU Foam-Prd-Packaging
Rgd PU Foam-Prd-Packaging
Rgd PU Foam-Prd-Refrig
Rgd PU Foam-Prd-Refrig
Control Option
Ammonia
HCFC-22
CFC-S02
HCFC-22
Alt Leak Test Gas
HCFC-22
CFC-S02
Recovery at Rework
HCFC-22
Alt Leak Test Gas-At Installation
CFC-502
Recovery at Service and Disposal
HCFC-22
Alt Leak Test Gas-At Installation
Recovery at Service and Disposal
CFC- 11/22
CFC- 11/22
Other Packaging Materials
EPS Bead Board
CFC-11/H20
CFC- 11/22
(1985S/kg) (1985S/kg) Application CFC Use CFC-11 CFC-12 CFC-113 CFC-1H CFC-115
-2.61
0.81
2.79
0.63
0.89
0.63
2.77
-0.97
0.81
1.01
2.79
2.92
-7.19
-5.73 .
1.43
0.30
0.30
•27.65
-17.06
-0.48
0.30
-2.61
0.81
2.79
0.63
0.89
0.63
2.77
-1.20
0.81
1.01
2.79
2.15
-7.19
-5.73
-0.03
0.30
0.30
-27.65
-17.06
-0.48
0.30
3.2X
6.4X
6.0X
7.5X
6.3X
2.8X
2.8X
1.3X
3. IX
2.7X
9. OX
2.7X
1.6X
0.4X
1.8X
10.0X
10. OX
18.0X
14. 8X
10.0X
9. OX
0.011X
0.021X
0.019X
0.015X
0.012X
0.007X
0.007X
0.010X
0.068X
0.059X
0.197X
0.058X
0.010X
0.003X
0.011X
0.151X 0.34X
0.024X 0.05X
0.285X 0.65X
0.234X 0.53X
0.431X 0.98X
0.388X 0.88X
0.02X
0.04X
0.04X
0.03X
0.02X
0.01X
0.01X
0.02X
0.13X
0.12X
0.39X
0.1 IX

0.09X
0.01X
0.16X
0.14X
0.25X
0.22X





2.09X
0.53X
2.34X




Spice funigant
N2 Purge then Pure EO
-0.05
-0.27
13.5X    0.011X
                                                 0.02X

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CASE 1 -- 1991

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 Control Options Simulated
 Year:              1991
 Cost Curve:        Case 1
 Use Scenario:      Middle Growth
 Regulatory Option:  CFC 50X/Halon Freeze
 Simulated CFC Price Increase:  * 1.84
          Application


 Aerosol Propellent

 Centrif Chillers (CFC-114)

 Centrif Chillers (CFC-11)

 Centrif Chillers (CFC-12)
 Centrif Chillers (CFC-12)
                    Control  Option
 Weighted   Weighted   Reduction  Reduction
  Trigger    Social    in CFC Use  in Total
   Price      Cost        for
C1985$/kg) (1985*/kg) Application
                                                                                                                                       Reduction in Compound Use
 Carbon Dioxide

 Recovery at Service and Disposal

 Recovery at Service and Disposal

 Recovery at Service and Disposal
 Alt Leak Test Gas
 Centrif Chillers  (CFC-500)   Recovery at Service and Disposal
 Cnvyrzd Vapor Degreesing
 Cnvyrzd Vapor Degressing
 Cnvyrzd Vapor Degreesing
 Cnvyrzd Vapor Degressing

 Cold Cleaning
 Cold Cleaning
 Cold Cleaning
 Cold Cleaning
 Cold Cleaning
 Cold Cleaning

 Cold Storage (CFC-12)
 Cold Storage (CFC-12)

 Cold Storage (CFC-502)
 Cold Storage (CFC-502)

 Commercial R&O Labs
 Commercial RftD Labs

 Contract Sterilization
 Contract Sterilization
 Contract Sterilization

Dehuni differs

Dry Cleaning
Dry Cleaning

Ext PS Bdstk

Ext PS Sht
Ext PS Sht
Ext PS Sht
 Aqueous Cleaning and Terpenes
 Reclaim Waste Solvent
 Housekeeping  Controls
 CFC-113 Azeotropes

 Petroleum Solvents
 Methyl  Chloroform
 Cover;  Drainage;  &  Increased Freeboard
 Reclaim Waste Solvent
 Housekeeping  Controls
 CFC-113 Azeotropes

 HCFC-22
 Alt Leak Test  Gas

 HCFC-22
 Alt Leak Test  Gas

 N2 Purge then  Pure EO
 Contract Out

 Explosion Proof Condensation/Reclamation
 N2 Purge  then Pure EO
Acid-H20 Scrubber & Condensation/Reclamation

Recovery at Rework

Refrigerated Condenser
Aqueous Cleaning

HCFC-22

Product Substitutes for Egg Cartons
Product Substitutes for Stock Food Trays
Product Substitutes for Single Service Plates;  Cups;
     -0.74

      0.47

      1.60

      0.74
      1.26

     •0.47
     0.73

    -2.64
    -0.64

     0.88

     0.00
     0.00
     0.00
 -0.74

  0.26

  1.22

  0.56
  1.26

 -0.68
-16.60
-0.36
0.00
0.00
-2.36
-1.34
-0.61
-0.32
0.00
0.00
0.81
1.26
-7.19
-7.13
-0.27
0.00
-2.34
-0.36
-0.17
-17.20
-0.36
0.00
0.00
-2.36
-1.34
-0.64
-0.32
0.00
0.00
0.81
1.26
-7.19
-7.13
-0.41
0.00
-2.34
-0.48
-0.62
 0.20

-3.01
-1.14

 0.88

 0.00
 0.00
 0.00
n Heiyiiieu 	 	
:ation CFC Use CFC-11 CFC-12 CFC-113 CFC-114 CFC-115
25. OX
12. OX
3.7X
3.7X
5. OX
10. IX
19.2X
2.4X
8.9X
7. IX
26. 7X
25. 6X
3.5X
1.3X
6.4X
7.4X
8.5X
2.9X
10.2X
0.2X
16.0X
10. 5X
7.5X
34.6X
14.4X
1.8X
21. 8X
3.4X
90. IX
2. OX
3.9X
2.7X
1.106X
0.044X
0.096X
0.035X
0.047X
0.031X
1.354X
0.171X
0.628X
0.498X
0.460X
0.442X
0.061X
0.023X
0.111X
0.127X
0.102X
0.035X
0.031X
O.OOOX
0.009X
0.006X
0.044X
0.204X
0.085X
0.003X
0.1 HX
0.018X
1.238X
0.058X
0.1 14X
0.078X
1.43X 1.30X

0.31X
0.07X
0.09X
0.08X


0.20X
0.07X

0.02X
0.01X
0.09X
0.40X
0.17X
O.OOX

2.43X
0.11X
0.22X
0.15X

2.85X



8.73X
1.10X
4.05X
3.21X
2.97X
2.85X
0.39X
0.15X
0.71X
0.82X

6.46X
0.10X



0.73X
0.12X



-------
  Control Options Simulated
  Year:              1991
  Cost Curve:        Case 1
  Use Scenario:      Middle Growth
  Regulatory Option: CFC SOX/Halon Freeze
  Simulated CFC Price Increase: S 1.84
          Application
 Ext PS Sht
 Ext PS Sht

 Freezers

 Hospitals
 Hospitals
 Hospitals

 Medical Equipment
 Medical Equipment
 Medical Equipment
 Medical Equipment
                                                 Control  Option
                                                                                   Weighted   Weighted   Reduction  Reduction
                                                                                    Trigger     Social     in CFC Use  in Total
                                                                                     Price       Cost         for
                                                                                  (1985S/kg)  (1985$/kg) Application
                                                                                                                                        Reduction in Compound Use
                              Product Substitutes  for Hinged Containers
                              HCFC*22

                              Recovery at Rework

                              Disposables
                              Contract Out
                              C02 (10/90 EO/C02)

                              Explosion Proof Condensation/Reclamation
                              N2 Purge then Pure EO
                              Acid-H20 Scrubber & Condensation/Reclamation
                              Contract Out
 Mobile Air Conditioners       Recovery at Service  -- Large Shops
          Vpr  Degreesing
          Vpr  Degreesing
          Vpr  Degreesing
          Vpr  Degrees ing
          Vpr  Degreesing
          Vpr  Degreesing
          Vpr  Degreesing
          Vpr  Degreesing
Open Top
Open Top
Open Top
Open Top
Open Top
Open Top
Open Top
Open Top

PE Foam
PE Foam
PE Foam
PE Foam
Pharmaceutical
Pharmaceutical

Phenolic Foam
Phenolic Foam

Process Refrig
Process Refrig
Process Refrig

Reciprocating Chillers
Reciprocating Chillers

Refrigerated Transport

Refrigerators
 Refrigerated Freeboard Chiller
 Aqueous Cleaning  and Terpenes
 Manual  Cover; Drainage;  Increased  Freeboard; & Thermo
 CFC-113 Automatic Cover
 Reclaim Waste Solvent
 CFC-113 Azeotropes
 Housekeeping Controls
 CFC-113 Automated Hoist

 Alternate Packaging Materials
 Rubber  or Plastic  Floatation Devices
 Rubber  or Plastic  Gaskets
 HCFC-22

 Contract Out
 N2 Purge then Pure EO

 Other Insulation Materials-Equiv Insul Capacity
 CFC-HIb

 Hydrocarbons
 Ammonia
 HCFC-22

 HCFC-22
Alt Leak Test Gas

HCFC-22

Recovery at Rework
                                                            0.00
                                                            0.39

                                                            0.07
                                                                                        1.84
 0.00
 0.35

-0.50
0.00
0.00
1.55
-2.31
-0.20
-0.17
0.00
0.00
0.00
1.17
-2.31
-0.37
-0.61
0.00
                                                                       0.73
•11.81
-11.65
•10.40
-1.55
-0.35
0.00
0.00
0.20
-9.87
-9.70
0.00
0.38
0.00
0.28
0.50
1.76
-3.29
-2.61
0.81
0.63
0.89
0.63
-0.97
-12.04
-12.40
-10.75
-1.80
-0.35
0.00
0.00
-0.81
-9.87
-9.90
0.00
0.38
0.00
-0.10
0.50
1.76
-3.29
-2.61
0.81
0.63
0.89
0.63
-1.20
h/l 1
ret ion I
1.4X
89.9X
1.3X
11. OX
2.2X
6.9X
4. OX
30. OX
2.6X
15. 8X
6.5X
5.8X
18.9X
0.8X
14. 5X
1.8X
7.0X
12. 8X
11. 2X
5. OX
2.9X
1.8X
90.3X
8.9X
12.8X
20.0X
13.3X
2.5X
5.4X
10.4X
12. 5X
5.9X
4.7X
1.9X
CFC Use CFC- 11
0.041X
2.618X
0.003X
0.355X
0.072X
0.224X
0.059X
0.438X
0.039X
0.231X
1.635X
0.344X
1.118X
0.045X
0.859X
0.107X
0.416X
0.761X
0.664X
0.072X
0.041X
0.027X
1.304X
0.024X
0.035X
0.117X 0.21X
0.078X 0.14X
0.008X
0.017X
0.034X
0.025X
0.012X
0.012X
0.016X
CFC-12 CFC-113
0.08X
5.14X
0.01X
0.70X
0.14X
0.44X
0.12X
0.86X
0.08X
0.45X
3.21X
2.22X
7.21X
0.29X
5.54X
0.69X
2.68X
4.91X
4.28X
0.07X
0.04X
0.03X
1.28X
0.05X
0.07X
0.34X
0.22X
0.02X
0.03X
0.07X
0.05X
0.02X
0.02X
0.03X
CFC- 114 CFC-115






2.36X
1.35X
0.87X
42.68X







-------
 Control Options Simulated
 Year:              1991
 Cost Curve:        Case 1
 Use Scenario:      Middle Growth
 Regulatory Option: CFC SOX/Halon Freeze
 Simulated CFC Price Increase: $ 1.84

          Application
                                                 Control  Option
                                                                    Weighted   Weighted   Reduction  Reduction
                                                                     Trigger    Social    in CFC Use   in Total
                                                                     Price      Cost        for
                                                                   (1985S/kg) (1985S/kg) Application
Reduction in Compound Use
 Retail Food (CFC-12)
 Retail Food (CFC-12)

 Retail Food (CFC-502)
 Retail Food (CFC-502)
 Retail Food (CFC-502)

 Rgd PU Foam-BStk-Cns-Ind
 Rgd PU Foam-BStk-Cns-ind
 Rgd PU Foam-BStk-Cns-Ind

 Rgd PU Foam-Bstk-Cons-Bldg
 Rgd PU Foam-Bstk-Cons-Bldg
 Rgd PU Foam-Bstk-Cons-Bldg

 Rgd PU Foam-Lam-Cons-Bldg
 Rgd PU Foam-Lam-Cons-Bldg
 Rgd PU Foam-Lam-Cons-Bldg
              HCFC-22
              Alt Leak Test Gas-At Installation

              HCFC-22
              Alt Leak Test Gas-At Installation
              Recovery at  Service and Disposal

              Other Insulation Naterials-Equiv  Insul Capacity
              Thick Fiberglass Batts
              CFC-1416

              Thick Fiberglass Batts/Thick Walls/Wide Stud Spacing
              Other Insulation Materials-Equiv  Insul Capacity
              CFC-Ulb

              Thick Fiberglass Batts/Thick Walls/Conv stud Spacing
              Other Insulation Materials-Equiv  Insul Capacity
              CFC-141b
Rgd PU Foam-Prd-Cons-Bldg
Rgd PU Foam-Prd-Cons-Bldg
Rgd PU Foam- Prd- Cons -Ind
Rgd PU Foam-Prd-Cons-Ind
Rgd PU Foam- Prd- Packaging
Rgd PU Foam- Prd- Packaging
Rgd PU Foam-Prd-Packaging
Rgd PU Foam-Prd-Refrig
Rgd PU Foam-Prd-Refrig
Rgd PU Foam-Prd-Refrig
Rgd PU Foam-Prd-Trans
Rgd PU Foam-Spd-Cns-Bldg
Rgd PU Foam- Spd-Cns- Ind
Rgd PU Foam-Spd-Cro-Ind
CFC- 11/22
CFC-141b
CFC- 11/22
CFC-141b
Other Packaging
EPS Bead Board
CFC-141b
CFC-11/H20
CFC- 11/22
CFC-141b
CFC-141b
CFC-141b
Thick Fiberglass
CFC-141b


Materials



Batts
Rgd PU Foam-Spd-

Spice funigant
Trans        CFC-141b

             N2 Purge then Pure EO
0.81
1.01
-7.19
-5.73
1.43
0.50
0.50
1.60
0.50
0.50
1.60
0.50
0.50
1.60
0.30
1.54
0.30
1.54
•27.65
•17.06
1.54
-0.48
0.30
1.54
1.54
1.59
0.50
1.59
1.59
-0.05
0.81
1.01
-7.19
-5.73
-0.03
0.50
0.50
1.60
0.50
0.50
1.60
0.50
0.50
1.60
0.30
1.54
0.30
1.54
-27.65
-17.06
1.54
-0.48
0.30
1.54
1.54
1.59
0.50
1.59
1.59
-0.27
'i Hciyiiieu -
:ation CFC Use
5.2X
2.7X
2.7X
0.4X
3.6X
8. OX
13.8X
13. 1X
0.9X
8.0X
15. 2X
1.0X
9.9X
14.9X
10. OX
15.0X
10.0X
15. OX
30. OX
21. OX
8.2X
10.0X
9.0X
13.5X
16.7X
16.6X
20.0X
13.3X
16. 7X
22. 5X
0.1 UX
0.059X
0.017X
0.003X
0.023X
0.007X
0.012X
0.012X
0.012X
0.101X
0.191X
0.060X
0.590X
0.885X
0.151X
0.227X
0.024X
0.036X
0.475X
0.333X
0.129X
0.431X
0.388X
0.581X
0.262X
0.616X
0.278X
0.185X
0.098X
0.019X
CFC-11


0.02X
0.04X
0.04X
0.04X
0.32X
0.61X
0.19X
1.90X
2.85X
0.34X
0.52X
0.05X
0.08X
1.08X
0.76X
0.29X
0.98X
0.88X
1.32X
0.60X
1.B3X
0.83X
0.5SX
0.29X

CFC-12 CFC-113 CFC-114 CFC-115
0.22X
0.12X




0.09X
0.13X
0.01X
0.02X
0.27X
0.19X
0.07X
0.25X
0.22X
0.34X
0.15X
0.09X
0.04X
0.03X
0.01X
0.04X

3.48X
0.53X
4.67X













-------
CASE 1 -- 1993

-------
 Control Options Simulated
 Year:              1993
 Cost Curve:        Case 1
 Use Scenario:      Middle Growth
 Regulatory Option: CFC 50X/Halon Freeze
 Simulated CFC Price Increase: $ 3.93
          Application
 Aerosol Propellent
 Aerosol Propellant

 Animal Labs

 Bee Hives
                                                 Control  Option
                                                       Weighted   Weighted   Reduction  Reduction
                                                        Trigger    Social     in CFC  Use  in  Total
                                                         Price      Cost         for
                                                      (1985$/kg)  (1985S/kg)  Application
                                                                                                                                       Reduction in Compound Use
 Carbon Dioxide
 HCFC-22 Blends

 FC-134a

 FC-134B
 Centrif Chillers (CFC-114)    Recovery at  Service  and Disposal
 Centrif Chillers (CFC-11)
 Centrif Chillers (CFC-11)
 Centrif Chillers (CFC-11)

 Centrif Chillers (CFC-12)
 Centrif Chillers (CFC-12)

 Centrif Chillers (CFC-500)
 Centrif Chillers (CFC-500)

 Cnvyrzd Vapor Degreesing
 Cnvyrzd Vapor Degreesing
 Cnvyrzd Vapor Degreesing
 Cnvyrzd Vapor Degreesing
 Cnvyrzd Vapor Decreasing

 Cold Cleaning
 Cold Cleaning
 Cold Cleaning
 Cold Cleaning
 Cold Cleaning
 Cold Cleaning

 Cold Storage (CFC-12)
 Cold Storage (CFC-12)
 Cold Storage (CFC-12)

 Cold Storage (CFC-S02)
 Cold Storage (CFC-502)

Commercial R&D Labs
Commercial R&O Labs

Contract Sterilization
Contract Sterilization
Contract Sterilization
 Market Mix
 Recovery at Service and Disposal
 HCFC-123

 Recovery at Service and Disposal
 Alt Leak Test  Gas

 Recovery at Service and Disposal
 Market Mix

 Aqueous Cleaning and Terpenes
 Carbon Adsorption  and Drying Tunnel
 Reclaim Waste  Solvent
 Housekeeping Controls
 CFC-113 Azeotropes

 Petroleum Solvents
 Methyl  Chloroform
 Cover;  Drainage; ft Increased Freeboard
 Reclaim Waste  Solvent
 CFC-113 Azeotropes
 Housekeeping Controls

 HCFC-22
 Alt Leak Test  Gas
 CFC-502

 HCFC-22
 Alt Leak Test Gas

 N2 Purge then Pure EO
 Contract Out

 Explosion Proof Condensation/Reclamation
N2 Purge then Pure EO
Acid-H20 Scrubber ft Condensation/Reclamation
-0.74
 2.21

 3.24

 3.24

 0.47
-0.74
 2.21

 3.24

 3.24

 0.26
0.00
1.60
3.02
0.74
1.26
-0.47
0.00
-16.60
-0.72
-0.36
O.'OO
0.00
-2.36
-1.34
-0.61
-0.32
0.00
0.00
0.81
1.26
2.79
-7.19
-7.13
-0.27
0.00
-2.34
-0.36
-0.17
0.00
1.22
3.02
0.56
1.26
-0.68
0.00
-17.20
-1.51
-0.36
0.00
0.00
-2.36
-1.34
-0.64
-0.32
0.00
0.00
0.81
1.26
2.79
-7.19
-7.13
-0.41
0.00
-2.34
-0.48
-0.62
ration CFC Use CFC-11 CFC-12 CFC-113 CFC-114 CFC-115
25. OX
25. OX
23. 1X
24. 9X
16.8X
16. OX
5.3X
5.3X
5.2X
4.9X
14. IX
23. 8X
24. OX
10. 3X
2. OX
7. OX
7.7X
40. OX
21. OX
2.9X
1.1X
8. OX
5.3X
11. 8X
2.8X
15. 6X
14.3X
0.1X
22.5X
13.5X
7.5X
48.6X
11. OX
1.106X
1.106X
O.OOOX
O.OOOX
0.061X
0.410X
0.135X
0.135X
0.049X
0.046X
0.043X
0.073X
1.692X
0.729X
0.139X
0.495X
0.540X
0.690X
0.363X
0.050X
0.019X
0.139X
0.091X
0.143X
0.034X
0.189X
0.044X
O.OOOX
0.012X
0.007X
0.044X
0.286X
0.065X
1.43X 1.30X
1.43X 1.30X
O.OOX
O.OOX

1.32X
0.43X
0.43X
0.10X
0.09X
0.12X
0.19X


0.28X
0.07X
0.37X

0.02X
0.01X
0.09X
0.56X
0.13X



4.00X



10.92X
4.70X
0.90X
3.19X
3.48X
4.45X
2.34X
0.32X
0.12X
0.89X
0.58X

9.04X
0.09X



-------
Control Options Simulated
Year:              1993
Cost Curve:        Case 1
Use Scenario:      Middle Growth
Regulatory Option: CFC SOX/Halon Freeze
Simulated CFC Price Increase:  $  3.93
Weighted   Weighted   Reduction  Reduction
 Trigger    Social    in CFC Use  in Total
                                                                                                                                      Reduction in Compound Use
Application
Dehumidif iers
Dry Cleaning
Dry Cleaning
Ext PS Bdstk
Ext PS Bdstk
Ext PS Sht
Ext PS Sht
Ext PS Sht
Ext PS Sht
Ext PS Sht
Flex PU Foam-Molded
Flex PU Foam-Molded
Flex PU Foam-Molded
Flex PU Foam-Slabstock
Flex PU Foam-Slabstock
Freezers
Hospitals
Hospitals
Hospitals
Medical Equipment
Medical Equipment
Medical Equipment
Medical Equipment
Mobile Air Conditioners
Mobile Air Conditioners
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
PE Foam
f>E Foam
Control Option (198S$/kg) (198S$/kg) Application CFC Use CFC-11 CFC-1Z CFC-113 CFC-114 CFC-115
Recovery at Rework
Refrigerated Condenser
Aqueous Cleaning
HCFC-22
FC-134a
Product Substitutes for Stock Food Trays
Product Substitutes for Egg Cartons
Product Substitutes for Single Service Plates; Cups;
Product Substitutes for Hinged Containers
HCFC-22
CFC-HIb
HD I -TD I/Water-Blown Systems in HR Process
HCFC-123
CFC-141b
HCFC-123
Recovery at Rework
Contract Out
Disposables
C02 (10/90 EO/C02)
Explosion Proof Condensation/Reclamation
N2 Purge then Pure EO
Acid-H20 Scrubber & Condensation/Reclamation
Contract Out
Recovery at Service and Quality Engineering
Recovery at Service -- Large Shops
Refrigerated Freeboard Chiller
Aqueous Cleaning and Terpenes
Manual Cover; Drainage; Increased Freeboard; & Thermo
CFC-113 Automatic Cover
Reclaim Waste Solvent
CFC-113 Azeotropes
Housekeeping Controls
CFC-113 Automated Hoist
Alternate Packaging Materials
Rubber or Plastic Floatation Devices
0.73
-2.64
-0.64
0.88
3.93
0.00
0.00
0.00
0.00
0.39
1.90
1.95
3.52
1.90
3.52
0.07
0.00
0.00
1.55
-2.31
-0.20
-0.17
0.00
•11.59
1.84
-11.81
-11.65
-10.40
-1.55
-0.35
0.00
0.00
0.20
-9.87
-9.70
0.20
-3.01
-1.14
0.88
3.93
0.00
0.00
0.00
0.00
0.35
1.90
1.19
3.52
1.90
3.52
-0.50
0.00
0.00
1.17
-2.31
-0.37
-0.61
0.00
-12.09
0.73
-12.04
-12.40
-10.75
-1.80
-0.35
0.00
0.00
-0.81
-9.87
-9.90
1.8X
21. 8X
3.4X
90. IX
6.7X
3.9X
2. OX
2.7X
1.4X
89. 9X
6.7X
46. 7X
10.4X
6 7X
8.3X
1.3X
3. OX
15. 4X
8.2X
4. OX
41.9X
2.2X
18.2X
2.0X
6.5X
5.8X
23.6X
0.7X
13. 6X
1.7X
6.6X
12. OX
10.5X
5. OX
2.9X
0.003X
0.1 14X
0.018X
1.238X
0.092X
0.114X
0.058X
0.078X
0.041X
2.618X
0.103X
0.718X
0.159X
0 357X
0.444X
0.003X
0.096X
0.497X
0.263X
0.059X
0.611X
0.032X
0.265X
0.503X
1 .635X
0.344X
1.397X
0.042X
0.805X
0.100X
0.389X
0.713X
0.623X
0.072X
0.041X
O.OOX

2.43X
0.18X
0.22X
0.11X
0.15X
0.08X
5.14X
0.33X
2.31X
0.51X
1.15X
K43X
0.01X
0.19X
0.9BX
0.52X
0.12X
1.20X
0.06X
0.52X
0.99X
3.21X








0.07X
0.04X

0.73X
0.12X















2.22X
9.01X
0.27X
5.19X
0.65X
2. SIX
4.60X
4.02X
2.36X
1.35X

-------
 Control Options Simulated
 Year:              1993
 Cost Curve:        Case 1
 Use Scenario:      Middle Growth
 Regulatory Option: CFC 50X/Halon Freeze
 Simulated CFC Price Increase: S 3.93
          Application
 PE Foam
 PE Foam

 Pharmaceutical
 Pharmaceutical

 Phenolic Foam
 Phenolic Foam
 Phenolic Foam

 Polypropylene Foam

 Process Refrig
 Process Refrig
 Process Refrig
 Process Refrig

 Rec i procat i ng Chi11ers
 Reciprocating Chillers
 Refrigerated  Transport
 Refrigerated  Transport

 Refrigerators

 Retail  Food (CFC-12)
 Retail  Food (CFC-12)
 Retail  Food (CFC-12)
 Retail  Food (CFC-12)

 Retail  Food (CFC-502)
 Retail  Food (CFC-S02)
 Retail  Food (CFC-502)

 Rgd PU  Foam-BStk-Cns-Ind
 Rgd PU  Foam-BStk-Cns-Ind
 Rgd PU  Foam-BStk-Cns-Ind
 Rgd PU  Foam-BStk-Cns-Ind

 Rgd PU  Foam-Bstk-Cons-Bldg
 Rgd PU  Foam-Bstk-Cons-Bldg
 Rgd PU  Foam-Bstk-Cons-Bldg
 Rgd PU  Foam-Bstk-Cons-Bldg

Rgd PU Foam-Lam-Cons-Bldg
Rgd PU Foam-Lam-Cons-Bldg
Rgd PU Foam-Lam-Cons-Bldg
                                                 Control Option
                                                       Weighted   Weighted   Reduction  Reduction
                                                        Trigger    Social     in CFC Use  in Total
                                                         Price      Cost         for
                                                                                                                                       Reduction in Compound Use
 Rubber or Plastic Gaskets
 HCFC-22

 Contract Out
 N2 Purge then Pure EO

 Other Insulation Naterials-Equiv Insul  Capacity
 CFC-l4lb
 HCFC-123

 Alternate Packaging Materials

 Hydrocarbons
 Ammonia
 HCFC-22
 CFC-502

 HCFC-22
 Alt  Leak Test  Gas
 HCFC-22
 CFC-502

 Recovery at  Rework

 HCFC-22
 Alt  Leak Test  Gas-At  Installation
 CFC-502
 Recovery at  Service and Disposal

 HCFC-22
 Alt  Leak Test  Gas-At  Installation
 Recovery at  Service and Disposal

 Other Insulation Materials-Equiv Insul Capacity
 Thick Fiberglass Batts
 CFC-141b
 HCFC-123

Other Insulation Materials-Equiv Insul Capacity
Thick Fiberglass Batts/Thick Walls/Wide Stud Spacing
CFC-141b
HCFC-123

Thick Fiberglass Batts/Thick Walls/Cony Stud Spacing
Other Insulation Materials-Equiv Insul Capacity
CFC-Ulb
0.00
0.38
0.00
0.28
0.50
1.76
2.68
0.00
0.38
0.00
-0.10
0.50
1.76
2.68
 -7.80

 -3.29
 -2.61
 0.81
 2.79

 0.63
 0.89
 0.63
 2.77

-0.97

 0.81
 1.01
 2.79
 2.92

-7.19
-5.73
 1.43

 0.50
 0.50
 1.60
 3.76

 0.50
 0.50
 1.60
 3.77

 0.50
 0.50
 1.60
 -7.80

 -3.29
 -2.61
 0.81
 2.79

 0.63
 0.89
 0.63
 2.77

-1.20

 0.81
 1.01
 2.79
 2.15

-7.19
-5.73
-0.03

 0.50
 0.50
 1.60
 3.77

 0.50
 0.50
 1.60
 3.77

 0.50
 0.50
 1.60
Ml 1
cation I
1.8X
90. 3X
8.9X
17.9X
28. OX
35. 9X
24. 1X
42. OX
3.5X
7.4X
14. OX
11. 8X
17.5X
5.6X
6.6X
6.6X
1.9X
7.3X
2.7X
21. OX
7.9X
3.7X
0.4X
5.4X
16. OX
12. 6X
35. 8X
23. 8X
16.0X
1.7X
41. OX
27. 4X
2. OX
19.6X
39. IX
• v i gn i ea -
:FC use
0.027X
1.304X
0.024X
0.048X
0.164X
0.211X
0.141X
0.372X
0.01 IX
0.024X
0.046X
0.038X
0.035X
0.011X
0.017X
0.017X
0.016X
0.159X
0.059X
0.460X
0.174X
0.024X
0.003X
0.034X
0.014X
0.011X
0.032X
0.021X
0.201X
0.021X
0.516X
0.345X
0.119X
1.168X
2.333X
CFC-11


0.29X
0.38X
0.25X
0.60X





0.05X
0.04X
0.10X
0.07X
0.65X
0.07X
1.66X
1.11X
0.38X
3.76X
7.51X
CFC-12 CFC-113 1
0.03X
1.28X
0.05X
0.10X
0.47X
0.60X
0.41X

0.02X
0.05X
0.09X
0.08X
0.07X
0.02X
0.03X
0.03X
0.03X
0.31X
0.12X
0.90X
0.34X




:FC-114 CFC-115
0.87X
42.68X


12.17X




4.87X
0.53X
7.01X




-------
 Control Options Simulated
 Year:              1993
 Cost Curve:         Case 1
 Use Scenario:      Niddle Growth
 Regulatory Option:  CFC SOX/Halon  Freeze
 Simulated CFC Price Increase: $ 3.93

          Application
 Rgd PU Foam-Lam-Cons-Bldg    HCFC-123
                                                Control Option
                                                      Weighted   Weighted   Reduction  Reduction
                                                       Trigger    Social    in CFC Use  in Total
                                                        Price      Cost        for
                                                     (1985S/kg) (1985$/kg) Application
                                                 Reduction  in Compound Use
 Rgd PU Foam-Prd-Cons-Bldg
 Rgd PU Foam-Prd-Cons-Bldg
 Rgd PU Foam-Prd-Cons-Bldg

 Rgd PU Foam-Prd-Cons-Ind
 Rgd PU Foam-Prd-Cons-Ind
 Rgd PU Foam-Prd-Cons-Ind

 Rgd PU Foam-Prd-Packaging
 Rgd PU Foam-Prd-Packaging
 Rgd PU Foam-Prd-Packaging
 Rgd PU Foam-Prd-Packaging

 Rgd PU Foam-Prd-Refrig
 Rgd PU Foam-Prd-Refrig
 Rgd PU Foam-Prd-Refrig

 Rgd PU Foam-Prd-Trans
 Rgd PU Foam-Prd-Trans

 Rgd PU Foam-Spd-Cns-Bldg
 Rgd PU Foam-Spd-Cns-Bldg

 Rgd PU Foam-Spd-Cns-Ind
 Rgd PU  Foam-Spd-Cns-Ind
 Rgd PU  Foam-Spd-Cns-Ind

Rgd PU Foam-Spd-Trans

Spice fumigant
 CFC-11/22
 CFC-Ulb
 HCFC-123

 CFC-11/22
 CFC-U1b
 HCFC-123

 Other Packaging Materials
 EPS Bead Board
 H20 only (C02)
 CFC-Ulb

 CFC-11/H20
 CFC-11/22
 CFC-Ulb

 CFC-11/22
 CFC-U1b

 CFC-Ulb
 HCFC-123

 Thick Fiberglass Batts
CFC-Ulb
HCFC-123

CFC-Ulb

N2 Purge then Pure EO
  3.77

 • 0.30
  1.54
  3.70

  0.30
  1.54
  3.50

-27.65
-17.06
 -1.47
  1.54

 -0.48
  0.30
  1.54

  0.30
  1.54

  1.59
  3.55

  0.50
  1.59
  3.55

  1.59

 -0.05
  3.77

  0.30
  1.54
  3.70

  0.30
  1.54
  3.50

-27.65
-17.06
 -1.47
  1.54

 -0.48
  0.30
  1.54

  0.30
  1.54

  1.59
  3.55

  0.50
  1.59
  3.55

  1.59

-0.27
Jl 1
:ation (
26.2%
10.0X
45. OX
30.0X
10. OX
45. OX
30.0X
30.0X
21. OX
16. 3X
16. 3X
10. OX
9.0X
40.6X
6.7X
46.8X
50.0X
33. 3X
20.0X
40. OX
26.7X
50.0X
22. 5X
•eigniea -
:FC use
1.563X
0.151X
0.682X
0.453X
0.024X
0.107X
0.071X
0.475X
0.333X
0.259X
0.259X
0.431X
0.388X
1.748X
0.105X
0.734X
1.851X
1.235X
0.278X
0.555X
0.370X
0.293X
0.019X
CFC- 11
5.03X
0.34X
1.55X
1.03X
0.05X
0.24X
0.16X
1.08X
0.76X
0.59X
0.59X
0.98X
0.88X
3.97X
0.24X
1.67X
S.SOX
3.67X
0.83X
1.6SX
1.10X
0.87X

CFC-12 CFC-113 CFC-114 CFC-115

0.09X
0.39X
0.26X
0.01X
0.06X
0.04X
0.27X
0.19X
0.15X
0.15X
0.25X
0.22X
1.01X
0.06X
0.42X
0.28X
0.19X
0.04X
0.08X
0.06X
0.04X
0.04X

-------
CASE 1 -- 1998

-------
Control Options Simulated
Year:              1998
Cost Curve:        Case 1
Use Scenario:      Middle Growth
Regulatory Option:  CFC SOX/Halon Freeze
Simulated CFC Price Increase:  $ 5.48
Weighted   Weighted   Reduction  Reduction
 Trigger    Social    in CFC Use  in Total
                                                                                                                                      Reduction in Compound Use
Application
Aerosol Propel I ant
Aerosol Propel lant
Animal Labs
Bee Hives
Centrif Chillers (CFC- 114)
Centrif Chillers (CFC-1U)
Centrif Chillers (CFC-11)
Centrif Chillers (CFC-11)
Centrif Chillers (CFC-11)
Centrif Chillers (CFC-12)
Centrif Chillers (CFC-12)
Centrif Chillers (CFC-12)
Centrif Chillers (CFC-12)
Centrif Chillers (CFC-SOO)
Centrif Chillers (CFC-SOO)
Cnvyrzd Vapor Degreesing
Cnvyrzd Vapor Degrees ing
Cnvyrzd Vapor Degrees ing
Cnvyrzd Vapor Degress ing
Cnvyrzd Vapor Degrees ing
Cold Cleaning
Cold Cleaning
Cold Cleaning
Cold Cleaning
Cold Cleaning
Cold Cleaning
Cold Storage (CFC-12)
Cold Storage (CFC-12)
Cold Storage (CFC-12)
Cold Storage (CFC-12)
Cold Storage (CFC-S02)
Cold Storage (CFC-S02)
Commercial RAO Labs
Conmercial R&O Labs
Commercial R&D Labs
Control Option
Carbon Dioxide
HCFC-22 Blends
FC-1348
FC-134a
Recovery at Service and Disposal
FC-134a
Market Mix
Recovery at Service and Disposal
HCFC-123
Recovery at Service and Disposal
Alt Leak Test Gas
Market Mix
FC-134a
Recovery at Service and Disposal
Market Mix
Aqueous Cleaning and Terpenes
Carbon Adsorption and Drying Tunnel
Reclaim Waste Solvent
Housekeeping Controls
CFC- 113 Azeo tropes
Petroleum Solvents
Methyl Chloroform
Cover; Drainage; & Increased Freeboard
Reclaim Waste Solvent
Housekeeping Controls
CFC- 113 Azeo tropes
HCFC-22
Alt Leak Test Gas
CFC-502
FC-134a
HCFC-22
Alt Leak Test Gas
N2 Purge then Pure EO
Contract Out
FC-134a
(1985$/kg) (1985*/kg) Application CFC Use CFC-11 CFC-12 CFC-113 CFC-114 CFC-115
-0.74
2.21
3.24
3.24
0.47
4.35
0.00
1.60
3.02
0.74
1.26
4.50
4.97
-0.47
0.00
16.60
-0.72
-0.36
0.00
0.00
-2.36
-1.34
-0.61
-0.32
0.00
0.00
0.81
1.26
2.79
4.97
•7.19
-7.13
-0.27
0.00
5.00
-0.74
2.21
3.24
3.24
0.26
4.35
0.00
1.22
3.02
0.56
1.26
7.62
4.97
-0.68
0.00
-17.20
-1.51
-0.36
0.00
0.00
-2.36
-1.34
-0.64
-0.32
0.00
0.00
0.81
1.26
2.79
4.97
-7.19
-7.13
-0.41
0.00
5.00
25. OX
25. OX
80. 9X
87. 5X
24. OX
53. 2X
40. OX
7.5X
18.4X
7.5X
4.8X
40. OX
16.6X
20. 3X
53. 5X
24. OX
15. 5X
1.8X
6.5X
7.0X
40. OX
21. OX
2.9X
1.1X
5.3X
a. ox
20. 3X
2.5X
26. 8X
25. OX
24. 5X
0.1X
22. 5X
15. 5X
54. 2X
1.106%
1.106X
O.OOOX
O.OOOX
0.087X
0.193X
1.025X
0.192X
0.472X
0.070X
0.045X
0.372X
0.155X
0.062X
0.164X
1.692X
1.093X
0.128X
0.456X
0.496X
0.690X
0.363X
0.050X
0.019X
0.091X
0.139X
0.246X
0.031X
0.324X
0.303X
0.075X
O.OOOX
0.012X
0.009X
0.030X
1.43X 1.30X
1.43X 1.30X
O.OOX
O.OOX

3.30X
0.62X
1.52X
0.14X
0.09X
0.73X
0.30X
0.17X
0.44X


0.48X
0.06X
0.64X
0.60X

0.02X
0.02X
0.06X



5.71X
12.65X



10.92X
7.05X
0.83X
2.94X
3.20X
4.45X
2.34X
0.32X
0.12X
0.58X
0.89X

15. SOX
0.07X


-------
Control Options Simulated
Year:              1998
Cost Curve:        Case 1
Use Scenario:      Hiddle Growth
Regulatory Option: CFC 50X/Halon Freeze
Simulated CFC Price Increase: * 5.48
                                                     Weighted   Weighted   Reduction  Reduction
                                                       Trigger    Social    in CFC Use  in Total
Reduction in Compound Use
Application
Contract Sterilization
Contract Sterilization
Contract Sterilization
Contract Sterilization
Dehuroidif iers
Dry Cleaning
Dry Cleaning
Ext PS Bdstk
Ext PS Bdstk
Ext PS Sht
Ext PS Sht
Ext PS Sht
Ext PS Sht
Ext PS Sht
Flex PU Foam-Molded
Flex PU Foam-Molded
Flex PU Foam-Molded
Flex PU Foam-Slabstock
Flex PU Foam-Slabstock
Freezers
Hospitals
Hospitals
Hospitals
Hospitals
Libraries
Liquid Food Freezing
Liquid Food Freezing
Medical Equipment
Medical Equipment
Medical Equipment
Medical Equipment
Medical Equipment
Knee i-ost Tor weigniea 	
Control Option (1985$/kg) (1985$/kg) Application CFC Use CFC-11 CFC-12 CFC-113 CFC-1K CFC-115
Explosion Proof Condensation/Reclamation
N2 Purge then Pure EO
Acid-H20 Scrubber & Condensation/Reclamation
FC-134a
Recovery at Rework
Refrigerated Condenser
Aqueous Cleaning
HCFC-22
FC-1348
Product Substitutes for Egg Cartons
Product Substitutes for Hinged Containers
Product Substitutes for Stock Food Trays
Product Substitutes for Single Service Plates; Cups;
HCFC-22
CFC-141b
MDI-TDI/Uater-Blown Systems in KR Process
HCFC-123
CFC-141b
HCFC-123
Recovery at Rework
Disposables
Contract Out
C02 (10/90 EO/C02)
FC-134a
FC-134a
FC-134a
Cryogenic
Explosion Proof Condensation/Reclamation
N2 Purge then Pure EO
Acid-H20 Scrubber & Condensation/Reclamation
Contract Out
FC-134a
-2.34
-0.36
-0.17
5.00
0.73
-2.64
-0.64
0.88
3.93
0.00
0.00
0.00
0.00
0.39
1.90
1.95
3.52
1.90
3.52
0.07
0.00
0.00
1.55
5.00
5.00
4.97
5.32
-2.31
-0.20
-0.17
0.00
5.18
-2.34
-0.48
-0.62
5.00
0.20
-3.01
-1.14
0.88
3.93
0.00
0.00
0.00
0.00
0.35
1.90
1.19
3.52
1.90
3.52
-0.50
0.00
0.00
1.17
5.00
5.00
4.97
5.03
-2.31
-0.37
-0.61
0.00
5,18
7.5X
55. 5X
9.2X
24. 3X
1.8X
21 .8X
3.4X
90. IX
10. OX
2. OX
1.4X
3.9X
2.7X
89.9X
17.8X
41. 2X
31 .9X
17.8X
25. 6X
1.3X
21 .9X
3.9X
7.4X
58.4X
87.5X
35. OX
6.5X
4.0X
47.8X
1.9X
23. OX
20. 1X
0.044X
0.327X
0.055X
0.143X
0.003X
0.1 UX
0.018X
1.238X
0.138X
0.058X
0.041X
0.114X
0.078X
2.618X
0.273X
0.634X
0.491X
0.954X
1 .370X
0.003X
0.708X
0.126X
0.239X
1.885X
0.001X
0.490X
0.091X
0.059X
0.698X
0.028X
0.336X
0.294X
0.09X
0.64X
0.11X
0.28X
O.OOX
0.73X
0.12X
2.43X
0.27X
0.11X
0.08X
0.22X
0.15X
5.14X
0.88X
2.0U
1.58X
3.07X
4.41X
0.01X
1.39X
0.25X
0.47X
3.70X
O.OOX
0.96X
0.18X
0.12X
1.37X
0.06X
"0.66X
0.58X
Mobile Air Conditioners
Recovery at Service and Quality Engineering
                                                                                      -11.59
                                                                   -12.09
                                                                                                               7. OX    1.763X
                                                                                                           3.46X

-------
 Control Options  Simulated
 Year:               1998
 Cost Curve:         Case  1
 Use Scenario:       Middle Growth
 Regulatory Option:  CFC 50X/Halon  Freeze
 Simulated CFC Price Increase: $ 5.48

         Application
                   Control Option
 Weighted   Weighted   Reduction  Reduction
  Trigger    Social     in CFC  Use   in  Total
   Price      Cost        for       Weighted  	
<1985$/kg) (1985*/kg)  Application   CFC Use   CFC-11  CFC-12 CFC-113  CFC-1U CFC-115
                                                                                                          Reduction  in Compound Use
Mobile Air Conditioners
Mobile Air Conditioners

Non-Commercial RSD Labs

Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing

PE Foam
PE Foam
PE Foam
PE Foam

Pharmaceutical
Pharmaceutical
Pharmaceutical

Phenolic Foam
Phenolic Foam
Phenolic Foam

Polypropylene Foam

Process Refrig
Process Refrig
Process Refrig
Process Refrig
Process Refrig

Reciprocating Chillers
Reciprocating Chillers
Reciprocating Chillers

Refrigerated Transport
Refrigerated Transport
Refrigerated Transport

Refrigerators

Retail  Food (CFC-12)
Recovery at Service  -- Large Shops                         1.84       0.73
FC-134a                                                    5.48       5.22

FC-134a                                                    5.00       5.00

Refrigerated Freeboard Chiller
Aqueous Cleaning and Terpenes
Manual Cover; Drainage;  Increased Freeboard; & Thermo
CFC-113 Automatic Cover
Reclaim Waste Solvent
Housekeeping Controls
CFC-113 Azeotropes
CFC-113 Automated Hoist

Alternate Packaging  Materials
Rubber or Plastic Floatation Devices
Rubber or Plastic Gaskets
HCFC-22

Contract Out
N2 Purge then Pure EO
FC-134a

Other Insulation Materials-Equiv Insul Capacity
CFC-1416
HCFC-123

Alternate Packaging Materials                             -7.80      -7.80

Hydrocarbons
Ammonia
HCFC-22
CFC-502
FC-134a

HCFC-22
Alt Leak Test Gas
FC-134a

HCFC-22
CFC-502
FC-134a

Recovery at Rework                                        -0.97      -1.20

HCFC-22                                                    0.81        0.81
                              6.5X
                            48.7X
1.635X
 12.3X
                            85.3X   O.OOOX
3.21X
24. IX

O.OOX
11.81
11.65
10.40
-1.55
-0.35
0.00
0.00
0.20
-9.87
-9.70
0.00
0.38
0.00
0.28
5.00
0.50
1.76
2.68
-12.04
-12.40
-10.75
-1.80
-0.35
0.00
0.00
-0.81
-9.87
-9.90
0.00
0.38
0.00
-0.10
5.00
0.50
1.76
2.68
3.29
2.61
0.81
2.79
4.97
0.63
0.89
4.89
0.63
2.77
4.89
-3.29
-2.61
0.81
2.79
4.97
0.63
0.89
4.89
0.63
2.77
4.89
5.8X
23.6X
0.7X
13. 6X
1.7X
12. OX
6.6X
10.5X
5. OX
2.9X
1.8X
90.3X
8.9X
20.6X
61. 7X
40.0X
29. 9X
30. IX
42. OX
5. OX
10. 5X
19.0X
14. 7X
35. 6X
30. IX
4.8X
4.9X
11. 2X
11. 2X
33.8X
1.9X
12.5X
0.344X
1.397X
0.042X
0.805X
0.100X
0.713X
0.389X
0.623X
0.072X
0.041X
0.027X
1 .304X
0.024X
0.056X
0.167X
0.235X
0.176X
0.177X
0.372X
0.016X
0.034X
0.062X
0.048X
0.1 16X
0.060X
0.009X
0.010X
0.029X
0.029X
0.088X
0.016X
0.274X








0.07X
0.04X
0.03X
1.28X
0.05X
0.11X
0.33X
0.42X
0.31X
0.32X
0.60X
0.03X
0.07X
0.12X
0.09X
0.23X
0.12X
0.02X
0.02X
0.06X
0.06X
0.17X
0.03X
0.54X
2.22X
9.01X
0.27X
5.19X
0.65X
4.60X
2. SIX
4.02X







0.67X
O.SOX
0.51X






















2.36X
1.35X
0.87X
42.68X






12.17X














-------
 Control Options Simulated
 Year:              1998
 Cost Curve:        Case 1
 Use Scenario:      Middle Growth
 Regulatory Option: CFC 50X/Halon Freeze
 Simulated CFC Price Increase:  $ 5.48

          Application
                    Control  Option
 Weighted   Weighted   Reduction  Reduction
  Trigger    Social     in CFC Use  in Total
   Price      Cost        for
(1985$/kg) (1985$/kg) Application
                                                                                                          Reduction  in Compound Use
 Retail Food (CFC-12)
 Retail Food (CFC-12)
 Retail Food (CFC-12)
 Retail Food (CFC-12)

 Retail Food (CFC-S02)
 Retail Food (CFC-502)
 Retail Food (CFC-502)

 Rgd PU Foam-BStk-Cns-Ind
 Rgd PU Foam-BStk-Cns-Ind
 Rgd PU Foam-BStk-Cns-Ind
 Rgd PU Foam-BStk-Cns-Ind

 Rgd PU Foam-Bstk-Cons-Bldg
 Rgd PU Foam-Bstk-Cons-Bldg
 Rgd PU Foam-Bstk-Cons-Bldg
 Rgd PU Foam-Bstk-Cons-Bldg

 Rgd PU Foam-Lam-Cons-Bldg
 Rgd PU Foam-Lam-Cons-Bldg
 Rgd PU Foam-Lam-Cons-Bldg
 Rgd PU Foam-Lam-Cons-Bldg

 Rgd PU Foam-Prd-Cons-Bldg
 Rgd PU Foam-Prd-Cons-Bldg
 Rgd PU Foam-Prd-Cons-Bldg

 Rgd PU Foam-Prd-Cons-Ind
 Rgd PU Foam-Prd-Cons-Ind
 Rgd PU Foam-Prd-Cons-Ind

 Rgd PU Foam-Prd-Packaging
 Rgd PU Foam-Prd-Packaging
 Rgd PU Foam-Prd-Packaging
 Rgd PU  Foam-Prd-Packaging
 Rgd PU  Foam-Prd-Packaging

 Rgd PU  Foam-Prd-Refrig
 Rgd PU  Foam-Prd-Refrig
 Rgd PU  Foem-Prd-Refrig
 Rgd PU  Foam-Prd-Refrig

Rgd PU Foam-Prd-Trans
Rgd PU Foam-Prd-Trans
Rgd PU Foam-Prd-Trans
 Alt Leak Test Gas-At Installation
 CFC-502
 Recovery at Service and Disposal
 FC-134a

 HCFC-22
 Alt Leak Test Gas-At Installation
 Recovery at Service and Disposal

 Other Insulation Naterials-Equiv  Insul Capacity
 Thick Fiberglass Batts
 CFC-HIb
 HCFC-123

 Thick Fiberglass Batts/Thick Walls/Wide Stud Spacing
 Other Insulation Materials-Equtv  Insul Capacity
 CFC-HIb
 HCFC-123

 Thick Fiberglass Batts/Thick Walls/Conv Stud Spacing
 Other Insulation Naterials-Equiv  Insul Capacity
 CFC-HIb
 HCFC-123

 CFC-11/22
 CFC-141b
 HCFC-123

 CFC-11/22
 CFC-Ulb
 HCFC-123

 Other Packaging Materials
 EPS Bead Board
 H20 only (C02)
 CFC-HIb
 HCFC-123

 CFC-11/H20
 CFC-11/22
CFC-HIb
 HCFC-123

CFC-11/22
CFC-H1b
HCFC-123
1.01
2.79
2.92
4.97
-7.19
-5.73
1.43
0.50
0.50
1.60
3.76
0.50
0.50
1.60
3.77
0.50
0.50
1.60
3.77
0.30
1.54
3.70
0.30
1.54
3.50
27.65
17.06
-1.47
1.54
3.70
-0.48
0.30
1.54
3.70
0.30
1.54
3.50
1.01
2.79
2.15
4.97
-7.19
-5.73
-0.03
0.50
0.50
1.60
3.77
0.50
0.50
1.60
3.77
0.50
0.50
1.60
3.77
0.30
1.54
3.70
0.30
1.54
3.50
-27.65
-17.06
-1.47
1.54
3.70
-0.48
0.30
1.54
3.70
0.30
1.54
3.50
kJI 1
cation 1
2.7X
21. OX
13. 2X
11. 6X
6.4X
0.4X
8.9X
20. OX
12.0X
34. OX
34. OX
2.9X
36. IX
30. 6X
30.6X
4.5X
23. 9X
35. 7X
35. 9X
10. OX
45. OX
45.0X
10.0X
45. OX
45.0X
30.0X
21 .OX
24. 5X
12.3X
8.2X
10. OX
9. OX
40. 6X
27. OX
10. OX
45. IX
30. OX
vciyuieu •
:FC use
0.059X
0.460X
0.289X
0.254X
0.040X
0.003X
0.057X
0.018X
0.011X
0.030X
0.030X
0.036X
0.454X
0.385X
0.385X
0.268X
1.423X
2.131X
2.140X
0.151X
0.682X
0.682X
0.024X
0.107X
0.107X
0.475X
0.333X
0.388X
0.194X
0.129X
0.431X
0.388X
1.748X
1.165X
0.157X
0.708X
0.471X
CFC- 11


0.06X
0.03X
0.10X
0.10X
0.12X
1.46X
1.24X
1.24X
0.86X
4.58X
6.86X
6.89X
0.34X
1.55X
1.55X
0.05X
0.24X
0.24X
1.08X
0.76X
0.88X
0.44X
0.29X
0.98X
0.88X
3.97X
2.65X
0.36X
1.61X
1.07X
CFC-12 CFC-113 (
0.12X
0.90X
0.57X
0.50X




0.09X
0.39X
0.39X
0.01X
0.06X
0.06X
0.27X
0.19X
0.22X
0.11X
0.07X
0.25X
0.22X
1.01X
0.67X
0.09X
0.41X
0.27X
:FC-114 CFC-115

8.34X
0.53X
11.68X









-------
Control Options Simulated
Year:              1998
Cost Curve:        Case 1
Use Scenario:      Middle Growth
Regulatory Option: CFC SOX/ttalon Freeze
Simulated CFC Price Increase: $ 5.48

         Application
                                                Control Option
                                                      Weighted   Weighted   Reduction  Reduction
                                                       Trigger    Social     in CFC Use  in Total
                                                        Price      Cost        for      Weighted
                                                     (1985$/kg) (1985*/kg) Application  CFC Use
                                                Reduction  in Compound Use
                                                                                                                              CFC-11  CFC-12 CFC-113  CFC-114  CFC-115
Rgd PU Foam-Spd-Cns-Bldg
Rgd PU Foam-Spd-Cns-Bldg

Rgd PU Foam-Spd-Cns-Ind
Rgd PU Foam-Spd-Cns-Ind
Rgd PU Foam-Spd-Cns-Ind

Rgd PU Foam-Spd-Trans
Rgd PU Foam-Spd-Trans

Spice fumigant
Spice fumigant
CFC-141b
HCFC-123

Thick Fiberglass Batts
CFC-Ulb
HCFC-123

CFC-HIb
HCFC-123

N2 Purge then Pure EO
FC-134a
 1.59
 3.55

 0.50
 1.59
 3.55

 1.59
 3.55

-0.05
 5.18
 1.59
 3.55

 0.50
 1.59
 3.55

 1.59
 3.55

-0.27
 5.18
50. OX
50. OX
20.0X
40. OX
40. OX
50. OX
33. 4X
22. 5X
36.0X
1.851X
1.851X
0.278X
0.555X
0.555X
0.293X
0.196X
0.019X
0.030X
5. SOX
5. SOX
0.83X
1.65X
1.65X
0.87X
0.58X


0.28X
0.28X
0.04%
0.08X
0.08X
0.04X
0.03X
0.04X
0.06X

-------
CASE 2 -- 1989

-------
Control Options Simulated
Year:              1989
Cost Curve:        Case 2
Use Scenario:      Middle Growth
Regulatory Option: CFC SOX/Halon Freeze
Simulated CFC Price Increase: t 0.00
         Application
 Aerosol  Propellent

 Centrif  Chillers  (CFC-11)

 Centrif  Chillers  (CFC-500)
 Centrif  Chillers  (CFC-500)

 Cnvyrzd  Vapor Degrees ing
 Cnvyrzd  Vapor Degreesing
 Cnvyrzd  Vapor Degreesing
 Cnvyrzd  Vapor Degreesing
 Cnvyrzd  Vapor Degreasing

 Cold Cleaning
 Cold Cleaning
 Cold Cleaning
 Cold Cleaning
 Cold Cleening
 Cold Cleaning

 Cold Storage (CFC-12)

 Cold Storage (CFC-502)
 Cold Storage (CFC-502)
 Cold Storage (CFC-502)

 Conmercial R&O Labs
 Commercial R&D Labs
 Commercial R&D Labs
 Commercial R&D Labs

Contract  Sterilization
Contract  Sterilization
Contract  Sterilization

Dry Cleaning
Dry Cleaning

Ext PS Bdstk

Ext PS Sht
Ext PS Sht
Ext PS Sht
Ext PS Sht
Ext PS Sht
                                                Control  Option
 Weighted   Weighted   Reduction  Reduction
  Trigger    Social    in CFC Use  in Total
   Price      Cost        for
(1985S/kg) (1985*/kg) Application
                                                                                                                                       Reduction in Compound Use
                             Carbon Dioxide

                             Market Mix

                             Recovery at  Service  and Disposal
                             Market Mix

                             Aqueous Cleaning and Terpenes
                             Carbon Adsorption and Drying Tunnel
                             Reclaim Waste  Solvent
                             CFC-113 Azeotropes
                             Housekeeping Controls

                             Petroleum Solvents
                             Methyl  Chloroform
                             Cover;  Drainage; & Increased Freeboard
                             Reclaim Waste  Solvent
                             Housekeeping Controls
                             CFC-113 Azeotropes

                             Ammonia

                             Ammonia
                             HCFC-22
                             Alt Leak Test Gas

                             Explosion Proof Condensation/Reclamation
                             N2 Purge then Pure EO
                            Acid-H20 Scrubber & Condensation/Reclamation
                            Contract Out

                            Explosion Proof Condensation/Reclamation
                            N2 Purge then Pure EO
                            Acid-H20 Scrubber & Condensation/Reclamation

                            Refrigerated Condenser
                            Aqueous Cleaning

                            HCFC-22

                            Product Substitutes  for  Egg  Cartons
                            Product Substitutes  for  Single  Service Plates;  Cups;
                            Product Substitutes  for  Stock Food Trays
                            HCFC-22
                            Product Substitutes  for  Hinged  Containers
     -0.74

      0.00
     -2.61

   -19.79
     -7.19
     -7.13

     -3.25
     -0.27
     -0.24
     0.00

     -2.34
     -0.36
     -0..17

     -2.64
     -0.64

     0.00

     0.00
     0.00
     0.00
     0.00
     0.00
  -0.74

  0.00
-0.47
0.00
16.60
-0.72
-0.36
0.00
0.00
-2.36
-1.34
-0.61
-0.32
0.00
0.00
-0.68
0.00
-17.20
-1.51
-0.36
0.00
0.00
-2.36
-1.34
-0.64
-0.32
0.00
0.00
 -2.61

-19.79
 -7.19
 -7.13

 -3.25
 -0.41
 -0.86
  0.00

 -2.34
 -0.48
 -0.62

 -3.01
 -1.14

  0.00

  0.00
  0.00
  0.00
  0.00
  0.00
cation CFC Use CFC-11 CFC-12 CFC-113 CFC-114 CFC- 115
30. OX
24. OX
6.1X
40.6X
20.0X
16.3X
1.9X
4.2X
14.4X
20.0X
28.0X
3.8X
1.4X
11. 7X
2.4X
3. OX
4.6X
13. 9X
0.1X
15. OX
23. OX
6.2X
4.2X
15.0X
19.1X
32. 9X
21. 8X
3.4X
44.9X
0.7X
0.9X
1.3X
89.9X
0.5X
1.326X
0.615X
0.019X
0.125X
1.411X
1.150X
0.135X
0.295X
1.016X
0.344X
0.482X
0.066X
0.025X
0.202X
0.041X
0.036X
0.014X
0.043X
O.OOOX
0.008X
0.013X
0.003X
0.002X
0.089X
0.1 13X
0.194X
0.1 HX
0.018X
0.616X
0.019X
0.026X
0.038X
2.618X
0.014X
1.71X 1.56X
1.98X
0.05X
0.33X


0.07X

0.02X
0.02X
0.01X
O.OOX
0.17X
0.22X
0.38X

1.21X
0.04X
0.05X
0.07X
5.14X
0.03X



9.10X
7.42X
0.87X
1.90X
6.55X
2.22X
3.11X
0.43X
0.16X
1.30X
0.26X




0.73X
0.12X








2.91X
8.82X
0.09X






-------
 Control Options Simulated
 rear:              1989
 Cost Curve:        Case 2
 Use Scenario:       Middle Growth
 Regulatory Option:  CFC 50X/Halon Freeze
 Simulated CFC  Price Increase:  * 0.00
          Application


 Hospitals
 Hospitals
 Hospitals

 Liquid Food Freezing

 Medical  Equipment
 Medical  Equipment
 Medical  Equipment
 Medical  Equipment

 Mobile Air  Conditioners

 Open Top Vpr Degreesing
 Open Top Vpr Degreasing
 Open Top Vpr Degreasing
 Open Top Vpr Degreasing
 Open Top Vpr Degreasing
 Open Top Vpr Degreasing
 Open Top Vpr Degreasing

 PE Foam
 PE Foam
 PE Foam

 Pharmaceutical
 Pharmaceutical

 Polypropylene Foam
 Polypropylene Foam

 Process Refrig
 Process Refrig

 Refrigerators

 Retail Food (CFC-502)
 Retail Food (CFC-502)

 Rgd PU Foam-Prd-Packaging
Rgd PU Foam-Prd-Packaging

Rgd PU Foam-Prd-Refrig

Spice funigant
Spice filitigant
                    Control Option
 Weighted   Weighted   Reduction  Reduction
  Trigger    Social     in CFC Use  in Total
   Price      Cost        for
(1985$/kg) (1985S/kg)  Application
                                                                                                                                       Reduction in Compound Use
 Disposables                                               0 00
 Steam Cleaning                                            0.00
 Contract Out                                              u!oO

 Air Blast                                                 -LIB

 Explosion Proof Condensation/Reclamation                  -2.31
 N2 Purge then Pure EO                                     -0.20
 Acid-H20 Scrubber & Condensation/Reclamation              -0.17
 Contract Out                                              0.00

 Proprietary Organic/75-85X CFC-12                         0.00

 Refrigerated Freeboard  Chiller
 Aqueous Cleaning and Terpenes
 Manual  Cover;  Drainage;  Increased Freeboard; & Thermo
 CFC-113 Automatic Cover
 Reclaim Waste Solvent
 Housekeeping Controls
 CFC-113 Azeotropes

 Alternate Packaging Materials
 Rubber  or Plastic Floatation Devices
 HCFC-22

 Explosion Proof  Condensation/Reclamation
 Contract  Out

 Alternate Packaging Materials
 Carbon  Adsorption with Recovery

 Hydrocarbons
 Ammonia

 Recovery  at Rework                                        -0.97

 HCFC-22                                                  -7.19
 Alt Leak  Test Gas-At  Installation                         -5.73

 Other Packaging Materials                                -27.65
 EPS Bead Board                                           -17.06

 CFC-11/H20                                                -0.48

 Explosion Proof Condensation/Reclamation                  -4.88
Acid-H20 Scrubber & Condensation/Reclamation              -0.36
                 0.00
                 0.00
                 0.00

                -1.57

                -2.31
                -0.37
                -0.61
                 0.00

                 0.00
•11.81
-11.65
•10.40
-1.55
-0.35
0.00
0.00
-9.87
-9.70
0.00
-5.76
0.00
-7.80
-1.53
-3.29
-2.61
-12.04
-12.40
-10.75
-1.80
-0.35
0.00
0.00
-9.87
-9.90
0.00
-5.76
0.00
-7.80
-1.59
-3.29
-2.61
               -1.20

               -7.19
               -5.73

              -27.65
              -17.06

               -0.48

               -4.88
               -1.29
»r i
ration I
21. OX
10. OX
1.5X
12. OX
4. OX
18. OX
3.1X
22. 4X
6.7X
5.8X
18. 9X
0.8X
14. 5X
1.8X
12.6X
7.9X
5. OX
2.9X
92. 3X
5. OX
10. IX
85. OX
3.6X
3. OX
6.8X
1.9X
3.2X
0.4X
36. IX
23. OX
10. OX
10.0X
3.9X
•eigniea -
:FC use
0.678X
0.322X
0.048X
0.168X
0.059X
0.262X
0.045X
0.328X
1.676X
0.344X
1.118X
0.045X
0.859X
0.107X
0.747X
0.467X
0.072X
0.041X
1.333X
0.013X
0.027X
0.752X
0.032X
0.010X
0.022X
0.015X
0.020X
0.003X
0.571X
0.365X
0.431X
0.008X
0.003X
CFC-11 CFC-12 CFC-113 CFC-114 CFC-115
1.33X
0.63X
0.10X
0.33X
0.12X
0.52X
0.09X
0.64X
3.29X
2.22X
7.21X
0.29X
5.54X
0.69X
4.82X
3.01X
0.07X 2.36X
0.04X 1.35X
1.31X 43.55X
0.03X
0.05X
1.21X 24.62X
0.05X 1.04X
0.02X
0.04X
0.03X
4.17X
0.53X
1.30X 0.33X
0.83X 0.21X
0.98X - 0.25X
0.02X
0.01X

-------
Control Options Simulated
Year:              1989
Cost Curve:        Case 2
Use Scenario:      Middle Growth
Regulatory Option:  CFC 50X/Halon Freeze
Simulated CFC Price Increase:  * 0.00

         Application
                                               Control Option
                                                     Weighted   Weighted   Reduction  Reduction
                                                      Trigger    Social    in CFC Use  in Total
                                                       Price      Cost        for      Weighted
                                                    (1985$/kg) (1985$/kg) Application  CFC Use
Reduction in Compound Use
                                                                                                                              CFC-11  CFC-12 CFC-113  CFC-1H CFC-115
Spice fumigant
HZ Purge then Pure EO
                                                                                      -0.05
                                                                                                 -0.27
                                                                                                              27.0X    0.022X
                                                                                                                                        0.04X

-------
CASE 2 -- 1991

-------
Control Options Simulated
Year:              1991
Cost Curve:        Case  2
Use Scenario:      Middle Growth
Regulatory Option:  CFC SOX/Halon Freeze
Simulated CFC Price Increase:  S 0.00
Weighted   Weighted   Reduction  Reduction
 Trigger    Social    in CFC Use  in Total
                                                                                                                                      Reduction in Compound Use
Application
Aerosol Propel lant
Centrif Chillers (CFC-11)
Centrif chillers (CFC-SOO)
Centrif Chillers (CFC-SOO)
Cnvyrzd Vapor Degress ing
Cnvyrzd Vapor Degrees ing
Cnvyrzd Vapor Degrees ing
Cnvyrzd Vapor Degrees ing
Cnvyrzd Vapor Degrees ing
Cold Cleaning
Cold Cleaning
Cold Cleaning
Cold Cleaning
Cold Cleaning
Cold Cleaning
Cold Storage (CFC- 12)
Cold Storage (CFC-502)
Cold Storage (CFC-502)
Cold Storage (CFC-502)
Coomercial R&O Labs
Commercial R&D Labs
Commercial R&O Labs
Commercial R&D Labs
Contract Sterilization
Contract Sterilization
Contract Sterilization
Dry Cleaning
Dry Cleaning
Ext PS Bdstk
Ext PS Sht
Ext PS Sht
Ext PS Sht
Ext PS Sht
Ext PS Sht
Control Option (1985*/kg) (1985S/kg) Application CFC Use CFC-11 CFC-12 CFC-113 CFC-114 CFC-115
Carbon Dioxide
Market Nix
Recovery at Service and Disposal
Market Mix
Aqueous Cleaning and Terpenes
Carbon Adsorption end Drying Tunnel
Reclaim Waste Solvent
CFC-113 Azeotropes
Housekeeping Controls
Petroleum Solvents
Methyl Chloroform
Cover; Drainage; & Increased Freeboard
Reclaim Waste Solvent
Housekeeping Controls
CFC-113 Azeotropes
Ammonia
Ammonia
HCFC-22
Alt Leak Test Gas
Explosion Proof Condensation/Reclamation
N2 Purge then Pure EO
Acid-H20 Scrubber & Condensation/Reclamation
Contract Out
Explosion Proof Condensation/Reclamation
N2 Purge then Pure EO
Acid-H20 Scrubber & Condensation/Reclamation
Refrigerated Condenser
Aqueous Cleaning
HCFC-22
Product Substitutes for Egg Cartons
Product Substitutes for Single Service Plates; Cups;
Product Substitutes for Stock Food Trays
HCFC-22
Product Substitutes for Hinged Containers
-0.74
0.00
-0.47
0.00
-16.60
-0.72
-0.36
0.00
0.00
-2.36
-1.34
-0.61
-0.32
0.00
0.00
-2.61
-19.79
-7.19
-7.13
-3.25
-0.27
-0.24
0.00
-2.34
-0.36
-0.17
-2.64
-0.64
0.00
0.00
0.00
0.00
0.00
0.00
-0.74
0.00
-0.68
0.00
-17.20
-1.51
-0.36
0.00
0.00
-2.36
-1.34
-0.64
-0.32
0.00
0.00
-2.61
-19.79
-7.19
-7.13
-3.25
-0.41
-0.86
0.00
-2.34
-0.48
-0.62
-3.01
-1.14
0.00
0.00
0.00
0.00
0.00
0.00
49.9X
40.0X
10. IX
63. 7X
40. OX
12. 2X
1.4X
9.4X
9.2X
40. OX
21. OX
2.9X
1.1X
8.8X
5.3X
5. OX
7.7X
21. 7X
0.1X
15.0X
38.3X
4.7X
5.3X
15. OX
31 .9X
26. 5X
21 .8X
3.4X
90. IX
2. OX
2.7X
3.9X
89. 9X
1.4X
2.210X
1.025X
0.031X
0.196X
2.820X
0.864X
0.101X
0.662X
0.651X
0.690X
0.363X
0.050X
0.019X
0.151X
0.092X
0.061X
0.024X
0.067X
O.OOOX
0.008X
0.021X
0.003X
0.003X
0.089X
0.188X
0.156X
0.1UX
0.018X
1.238X
0.058X
0.078X
0.114X
2.618X
0.041X
2.85X 2.60X
3.30X
0.08X
0.52X


0.12X

0.02X
0.04X
0.01X
0.01X
0.17X
0.37X
0.31X


2.43X
0.11X
0.15X
~0.22X
5.14X
0.08X



1B.19X
5.57X
0.65X
4.27X
4.20X
4.45X
2.34X
0.32X
0.12X
0.97X
0.59X

4.85X
13.73X
0.06X


0.73X
0.12X







-------
Control Options Simulated
Year:              1991
Cost Curve:        Case 2
Use Scenario:      Middle Growth
Regulatory Option: CFC 50X/Halon Freeze
Simulated CFC Price Increase: * 0.00
Weighted   Weighted   Reduction  Reduction
 Trigger    Social    in CFC Use  in Total
                                                                                                                                      Reduction in Compound Use
Application
Hospitals
Hospitals
Hospitals
Liquid Food Freezing
Medical Equipment
Medical Equipment
Medical Equipment
Medical Equipment
Mobile Air Conditioners
Open Top Vpr Degress ing
Open Top Vpr Degrees ing
Open Top Vpr Degress ing
Open Top Vpr Degrees ing
Open Top Vpr Degrees ing
Open Top Vpr Degress ing
Open Top Vpr Degrees ing
PE Foam
PE Foam
PE Foam
Pharmaceutical
Pharmaceutical
Polypropylene Foam
Polypropylene Foam
Process Refrig
Process Refrig
Refrigerators
Retail Food (CFC-502)
Retail Food (CFC-502)
Rgd PU Foam-Prd-Packaging
Rgd PU Foam-Prd-Packaging
Rgd PU Foam-Prd-Refrig
Spice funigant
Spice funigant
. •••*•«* wwoi iui we inn lea -
Control Option <1985t/kg> (1985$/kg) Application CFC Use
Disposables
Steam Cleaning
Contract Out
Air Blast
Explosion Proof Condensation/Reclamation
N2 Purge then Pure EO
Acid-H20 Scrubber & Condensation/Reclamation
Contract Out
Proprietary Organic/75-85% CFC- 12
Refrigerated Freeboard Chiller
Aqueous Cleaning and Terpenes
Manual Cover; Drainage; Increased Freeboard; & Thermo
CFC- 113 Automatic Cover
Reclaim Waste Solvent
Housekeeping Controls
CFC-113 Azeot ropes
Alternate Packaging Materials
Rubber or Plastic Floatation Devices
HCFC-22
Explosion Proof Condensation/Reclamation
Contract Out
Alternate Packaging Materials
Carbon Adsorption with Recovery
Hydrocarbons
Amnonia
Recovery at Rework
HCFC-22
Alt Leak Test Gas-At Installation
Other Packaging Materials
EPS Bead Board
CFC-11/H20
Explosion Proof Condensation/Reclamation
Acid-H20 Scrubber & Condensation/Reclamation
0.00
0.00
0.00
-1.18
-2.31
-0.20
-0.17
0.00
0.00
-11.81
-11.65
-10.40
-1.55
-0.35
0.00
0.00
-9.87
-9.70
0.00
-5.76
0.00
-7.80
-1.53
-3.29
-2.61
-0.97
-7.19
-5.73
-27.65
-17.06
-0.48
-4.88
-0.36
0.00
0.00
0.00
-1.57
-2.31
-0.37
-0.61
0.00
0.00
-12.04
-12.40
-10.75
-1.80
-0.35
0.00
0.00
-9.87
-9.90
0.00
-5.76
0.00
-7.80
-1.59
-3.29
-2.61
-1.20
-7.19
-5.73
-27.65
-17.06
-0.48
-4.88
-1.29
35. OX
10. OX
2.5X
20. OX
4. OX
30. OX
2.6X
31. 7X
t
20. OX
5.8X
37. 7X
0.6X
10.9X
1.4X
8. OX
11. 8X
5. OX
2.9X
92.3X
5. OX
16.9X
85. OX
6.0X
5. OX
11. 3X
1.9X
5.3X
0.4X
60.0X
24. OX
10.0X
10.0X
3.9X
1.131X
0.322X
0.080X
0.280X
0.059X
0.438X
0.039X
0.462X
5.033X
0.344X
2.234X
0.033X
0.643X
0.080X
0.473X
0.701X
0.072X
0.041X
1.333X
0.013X
0.046X
0.752X
0.053X
0.016X
0.037X
0.015X
0.034X
0.003X
0.950X
0.380X
0.431X
0.008X
0.003X
CFC-11 CFC-12 CFC-113 CFC-114 CFC-115
2.22X
0.63X
0.16X
0.55X
0.12X
0.86X
0.08X
0.91X
9.88X
2.22X
14.41X
0.22X
4.15X
0.52X
3.05X
4.52X
0.07X 2.36X
0.04X 1.35X
1.31X 43.55X
0.03X
0.09X
1.21X 24.62X
0.09X 1.74X
0.03X
0.07X
0.03X
6.95X
0.53X
2.16X 0.55X
0.86X 0.22X
0.98X 0.25X
0.02X
0.01X

-------
Control Options Simulated
Year:              1991
Cost Curve:        Case 2
Use Scenario:      Middle Growth
Regulatory Option: CFC SOX/Halon  Freeze
Simulated CFC Price Increase:  $ 0.00
         Application
                                               Control Option
                                                      Weighted   Weighted   Reduction  Reduction
                                                       Trigger    Social     in CFC Use   in Total
                                                       Price •     Cost         for       Weighted
                                                     (1985S/kg)  <1985*/kg) Application   CFC Use
                                                                                                                                      Reduction in Compound Use
                                                                                                                              CFC-11  CFC-12 CFC-113  CFC-1U CFC-115
Spice funigant
N2 Purge then Pure EO
                                                                                      -0.05
                                                                     -0.27
                                                                                                              45.OX    0.037X
                                                                                                                                        0.07X

-------
CASE 2 -- 1993

-------
 Control Options Simulated
 Year:              1993
 Cost Curve:        Case 2
 Use Scenario:      Middle Growth
 Regulatory Option: CFC 50X/Halon Freeze
 Simulated CFC Price Increase: $ 1.55
          Application


 Aerosol Propellent

 Centrif Chillers (CFC-1H)

 Centrif Chillers (CFC-11)

 Centrif Chillers (CFC-12)
 Centrif Chillers (CFC-12)

 Centrif Chillers (CFC-500)
 Centrif Chillers (CFC-500)

 Cnvyrzd Vapor Degressing
 Cnvyrzd Vapor Degreesing
 Cnvyrzd Vapor Degreasing
 Cnvyrzd Vapor Degreasing
 Cnvyrzd Vapor Degreasing

 Cold  Cleaning
 Cold  Cleaning
 Cold  Cleaning
 Cold  Cleaning
 Cold  Cleaning
 Cold  Cleaning

 Cold  Storage (CFC-12)
 Cold  Storage (CFC-12)
 Cold  Storage (CFC-12)

 Cold  Storage (CFC-502)
 Cold  Storage (CFC-502)
 Cold  Storage (CFC-502)

 Commercial RSD Labs
 Commercial R&O Labs
 Commercial R&O Labs
 Commercial R&O Labs

Contract Sterilization
Contract Sterilization
Contract Sterilization

Dehumidifiers

Dry Cleaning
Dry Cleaning
                    Control Option
 Weighted   Weighted   Reduction  Reduction
  Trigger    Social     in CFC Use   in Total
   Price      Cost         for
(1985$/kg) (1985S/kg)  Application
                                                                                                                                       Reduction in Compound Use
 Carbon Dioxide

 Recovery at Service and Disposal

 Market Nix

 Recovery at Service and Disposal
 Alt Leak Test Gas

 Recovery at Service and Disposal
 Market Mix

 Aqueous Cleaning and Terpenes
 Carbon Adsorption and Drying Tunnel
 Reclaim Waste Solvent
 CFC-113 Azeotropes
 Housekeeping Controls

 Petroleum Solvents
 Methyl  Chloroform
 Cover;  Drainage;  & Increased Freeboard
 Reclaim Waste Solvent
 Housekeeping Controls
 CFC-113 Azeotropes

 Ammonia
 HCFC-22
 Alt Leak Test Gas

 Anmonia
 HCFC-22
 Alt Leak Test Gas

 Explosion Proof Condensation/Reclamation
 N2 Purge then Pure EO
 Acid-H20 Scrubber & Condensation/Reclamation
 Contract  Out

 Explosion Proof Condensation/Reclamation
 N2 Purge  then Pure EO
 Acid-H20  Scrubber & Condensation/Reclamation

 Recovery  at Rework

 Refrigerated Condenser
Aqueous Cleaning
     -0.74
 -0.74
0.47
0,00
0.74
1.26
-0.47
0.00
-16.60
-0.72
-0.36
0.00
0.00
-2.36
-1.34
-0.61
-0.32
0.00
0.00
-2.61
0.81
1.26
-19.79
-7.19
-7.13
-3.25
-0.27
-0.24
0.00
-2.34
-0.36
-0.17
0.26
0.00
0.56
1.26
-0.68
0.00
-17.20
-1.51
-0.36
0.00
0.00
• -2.36
-1.34
-0.64
-0.32
0.00
0.00
-2.61
0.81
1.26
-19.79
-7.19
-7.13
-3.25
-0.41
-0.86
0.00
-2.34
-0.48
-0.62
     0.73

    -2.64
    -0.64
 0.20

-3.01
-1.14
:ation CFC Use CFC-11 CFC-12 CFC-113 CFC-114 CFC-115
49. 9X
16.8X
40. OX
5.2X
4.9X
14. IX
59. 7X
50. OX
10.2X
1.2X
10.4X
7. OX
40. OX
21. OX
2.9X
1.1X
8.8X
7.1X
7. OX
15. 6X
2.7X
10. 7X
28. 2X
0.1X
15. OX
38. 3X
4.7X
7.4X
15. OX
44. 6X
20.2X
1.8X
21 .8X
3.4X
2.210X
0.061X
1.025X
0.049X
0.046X
0.043X
0.183X
3.525X
0.719X
0.084X
0.735X
0.496X
0.690X
0.363X
0.050X
0.019X
0.151X
0.122X
0.085X
0.189X
0.033X
0.033X
0.087X
O.OOOX
0.008X
0.021X
0.003X
0.004X
0.089X
0.263X
0.1 19X
0.003X
0.1 14X
0.018X
2.85X 2.60X

3.30X
0.10X
0.09X
0.12X
0.49X


0.17X
0.37X
0.06X

0.02X
0.04X
0.01X
0.01X
0.17X
0.52X
0.23X
O.OOX






22.74X
4.64X
0.54X
4.74X
3.20X
4.45X
2.34X
0.32X
0.12X
0.97X
0.79X





0.73X
0.12X

4.00X






6.78X
17.86X
0.03X





-------
 Control Options Simulated
 Year:              1993
 Cost Curve:         Case 2
 Use Scenario:       Middle Growth
 Regulatory Option:  CFC SOX/Halon  Freeze
 Simulated CFC  Price Increase:  $ 1.55
                                                      Weighted   Weighted   Reduction  Reduction
                                                        Trigger    Social    in CFC Use  in Total
                                                                                                                                       Reduction in Compound Use
Application
Dry Cleaning
Ext PS Bdstk
Ext PS Sht
Ext PS Sht
Ext PS Sht
Ext PS Sht
Ext PS Sht
Freezers
Hospitals
Hospitals
Hospitals
Hospitals
Liquid Food Freezing
Medical Equipment
Medical Equipment
Medical Equipment
Medical Equipment
Mobile Air Conditioners
Mobile Air Conditioners
Open Top Vpr Degress ing
Open Top Vpr Degrees ing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
Open Top Vpr Degreasing
PE Foam
PE Foam
PE Foam
Pharmaceutical
Pharmaceutical
Pharmaceutical
Pharmaceutical
Control Option (1985S/kg) (19B5S/kg) Application CFC Use CFC-11 CFC-12 CFC-113 CFC-1U CFC-115
Reclaim Wastes
HCFC-22
Product Substitutes for Hinged Containers
Product Substitutes for Stock Food Trays
HCFC-22
Product Substitutes for Single Service Plates; Cups;
Product Substitutes for Egg Cartons
Recovery at Rework
Disposables
Contract Out
Steam Cleaning
C02 (10/90 EO/C02)
Air Blast
Explosion Proof Condensation/Reclamation
N2 Purge then Pure EO
Acid-H20 Scrubber & Condensation/Reclamation
Contract Out
Recovery at Service and Quality Engineering
Proprietary Organic/75-85X CFC-12
Refrigerated Freeboard Chiller
Aqueous Cleaning and Terpenes
Manual Cover; Drainage; Increased Freeboard; & Thermo
CFC-113 Automatic Cover
Reclaim Waste Solvent
CFC-113 Azeot ropes
Housekeeping Controls
CFC-113 Automated Hoist
Alternate Packaging Materials
Rubber or Plastic Floatation Devices
HCFC-22
Explosion Proof Condensation/Reclamation
Contract Out
N2 Purge then Pure EO
Acid-H20 Scrubber & Condensation/Reclamation
0.75
0.00
0.00
0.00
0.00
0.00
0.00
0.07
0.00
0.00
0.00
1.55
-1.18
-2.31
-0.20
-0.17
0.00
-11.59
0.00
-11.81
-11.65
-10.40
•1.55
-0.35
0.00
0.00
0.20
-9.87
-9.70
0.00
-5.76
0.00
0.28
0.97
0.75
0.00
0.00
0.00
0.00
0.00
0.00
-0.50
0.00
0.00
0.00
1.17
-1.57
-2.31
-0.37
-0.61
0.00
-12.09
0.00
-12.04
-12.40
-10.75
-1.80
-0.35
0.00
0.00
-0.81
-9.87
-9.90
0.00
-5.76
0.00
-0.10
-0.36
1.2X
90. IX
1.4X
3.9X
89.9%
2.7%
2. OX
1.3X
35. OX
3.5X
10. OX
35. OX
28.0X
4. OX
41. 9X
2.2X
25. 9X
2. OX
19.6X
5.8X
47. IX
0.5X
9. OX
1.1X
9.8X
6.6X
5.8X
5. OX
2.9X
92.3X
5. OX
16.9X
30. 7X
11. 4X
0.006X
1.238X
0.041X
0.1 14X
2.618X
0.078X
0.058X
0.003X
1.131X
0.1 13X
0.322X
1.131X
0.391X
0.059X
0.611X
0.032X
0.378X
0.503X
4.931X
0.344X
2.793X
0.028X
0.536X
0.067X
0.583X
0.394X
0.344X
0.072X
0.041X
1.333X
0.013X
0.046X
0.083X
0.031X
0.04X
2.43X
0.08X
0.22X
5.14X
oiisx
0.11X
0.01X
2.22X
0.22X
0.63X
2.22X
0.77X
0.12X
1.20X
0.06X
0.74X
0.99X
9.68X
2.22X
18.01X
0.18X
3.46X
0.43X
3.76X
2.54X
2.22X
0.07X
0.04X
1.31X
0.03X
0.09X
-0.16X
0.06X
























2.36X
1.35X
43.55X




Phenolic Foam
Other Insulation Materials-Equiv Insul  Capacity
                                                                                       0.50
0.50
80.IX    0.470X   0.84X
1.35X

-------
 Control Options Simulated
 Tear:              1993
 Cost Curve:        Case 2
 Use Scenario:      Kiddle Growth
 Regulatory Option: CFC SOX/Halon Freeze
 Simulated CFC Price Increase: S 1.55

          Application
                                                 Control  Option
                                                        Weighted   Weighted   Reduction  Reduction

                                                         Tprr?c9eCr    Sc°os?1     '"" 5" ""  «!MS«!i	 **«i.n «" Co«pound Use
 Polypropylene Foam
 Polypropylene Foam

 Process Refrig
 Process Refrig
 Process Refrig

 Reciprocating Chillers
 Reciprocating Chillers

 Refrigerated Transport

 Refrigerators

 Retail  Food  (CFC-12)
 Retail  Food  (CFC-12)

 Retail  Food  (CFC-502)
 Retail  Food  (CFC-502)
 Retail  Food  (CFC-502)

 Rgd PU  Foan-BStk-Cns-Ind
 Rgd PU  Foam-BStk-Cns-Ind

 Rgd PU  Foam-Bstk-Cons-Bldg
 Rgd PU  Foam-Bstk-Cons-Bldg

 Rgd PU Foam-Lam-Cons-Bldg
Rgd PU Foam-Lam-Cons-Bldg

Rgd PU Foam-Prd-Cons-Bldg
Rgd PU Foam-Prd-Cons-Bldg

Rgd PU Foam-Prd-Cons-Ind
Rgd PU Foam-Prd-Cons-Ind

»gd PU Foam-Prd-Packaging
tgd PU Foam-Prd-Packaging
Igd PU Foam-Prd-Packaging
tgd PU Foam-Prd-Packaging

»gd PU Foam-Prd-Refrig
igd PU Foam-Prd-Refrig
tgd PU Foam-Prd-Refrig
  Alternate Packaging Materials
  Carbon Adsorption with Recovery

  Hydrocarbons
  Ammonia
  HCFC-22

  HCFC-22
  Alt Leak Test Gas

  HCFC-22

 Recovery at Rework

 HCFC-22
 Alt Leak Test Gas-At Installation

 HCFC-22
 Alt Leak Test Gas-At Installation
 Recovery at Service and Disposal

 Other Insulation Materials-Equiv  Insul  Capacity
 Thick Fiberglass Batts

 Other Insulation Naterials-Equiv  Insul  Capacity
 Thick Fiberglass Batts/Thick Walls/Wide Stud Spacing

 Thick Fiberglass Batts/Thick Ualls/Conv Stud Spacing
 Other Insulation Naterials-Equiv  Insul  Capacity

 CFC-11/22
 CFC-141b

 CFC-11/22
 CFC-141b

Other Packaging Materials
EPS Bead Board
H20 only (C02)
CFC-H1b

CFC-11/H20
CFC-11/22
CFC-Klb
  -7.80
  -1.53

  -3.29
  -2.61
   0.81

   0.63
   0.89

   0.63

  -0.97

   0.81
   1.01

  -7.19
  -5.73
   1.43

  0.50
  0.50

  0.50
  0.50

  0.50
  0.50

  0.30
  1.54

  0.30
  1.54

-27.65
-17.06
 -1.47
  1.54

 -0.48
  0.30
  1.54
  -7.80
  -1.59

  -3.29
  -2.61
   0.81

   0.63
   0.89

   0.63

  -1.20

   0.81
   1.01

  -7.19
  -5.73
  -0.03

  0.50
  0.50

  0.50
  0.50

  0.50
  0.50

  0.30
  1.54

  0.30
  1.54

-27.65
-17.06
 -1.47
  1.54

 -0.48
  0.30
  1.54
1 VI
i cat ion
85. OX
8.4X
7. OX
15. 7X
15. 7X
29.8X
4.8X
13. IX
1.9X
14. 6X
2.7X
7.4X
0.4X
6.2X
40. OX
18.0X
56. IX
3. IX
7. OX
46.5X
10. OX
45. OX
10. OX
45. OX
60. OX
24. OX
5.3X
5.3X
10. OX
9. OX
40. 6X
OTCiyillVU '
CFC Use
0.752X
0.074X
0.023X
0.051X
0.051X
0.059X
0.009X
0.034X
0.015X
0.319X
0.059X
0.047X
0.003X
0.040X
0.035X
0.016X
0.705X
0.039X
0.416X
2.774X
0.1S1X
0.682X
0.024X
0.107X
0.950X
0.380X
0.084X
0.084X
0.431X
0.388X
1.748X
CFC-11
1.21X
0.12X










0.11X
0.05X
2.27X
0.13X
1.34X
8.93X
0.34X
1.55X
0.05X
0.24X
2.16X
0.86X
0.19X
0.19X
0.98X
0.88X
3.97X
CFC- 12 CFC- 113 .CFC- 114 CFC- 115

0.04X
0.10X
0.10X
0.12X
0.02X
0.07X
0.03X
0.63X
0.12X







0.09X
0.39X
0.01X
0.06X
0.55X
0.22X
0.05X
0.05X
0.25X
0.22X
1.01X
24.62X
2.43X









9.73X
0.53X
8.18X


















-------
Control Options Simulated
Year:              1993
Cost Curve:        Case 2
Use Scenario:      Middle Growth
Regulatory Option: CFC SOX/Halon Freeze
Simulated CFC Price Increase: $ 1.55
         Application
Rgd PU Foam-Prd-Trans
Rgd PU Foam-Prd-Trans
                                                Control Option
                                                      Weighted   weighted   Reduction  Reduction
                                                       Trigger    Social    in CFC Use  in Total
                                                        Price      Cost        for
                                                     (1985$/kg) (1985S/kg) Application
CFC-11/22
CFC-Ulb
Rgd PU Foam-Spd-Cns-Ind      Thick Fiberglass Batts
Spice fumigant
Spice fumigant
Spice fumigant
Explosion Proof Condensation/Reclamation
Acid-H20 Scrubber ft Condensation/Reclamation
N2 Purge then Pure EO
 0.30
 1.54

 0.50

-4.88
-0.36
-0.05
 0.30
 1.54

 0.50

-4.88
-1.29
-0.27
i MCI nil lea 	 .......... 	 .......... 	
ation CFC Use CFC-11 CFC-12 CFC-113 CFC-114 CFC-115
10. OX
45. IX
20. OX
10.0X
3.9X
45.0X
0.157X
0.708X
0.278X
0.008X
0.003X
0.037X
0.36X
1.61X
0.83X

0.09X
0.41X
0.04X
0.02X
0.01X
0.07X

-------
CASE 2 -- 1998

-------
 Control Options Simulated
 Year:              1998
 Cost Curve:        Case 2
 Use Scenario:       Middle Growth
 Regulatory Option:  CFC 50X/Halon Freeze
 Simulated CFC  Price Increase:  $ 4.49

          Application
                                                 Control Option
                                                                           Weighted   Weighted   Reduction  Reduction
                                                                            Trigger    Social    in CFC Use  in Total
                                                                             Price      Cost        for
                                                                          (1985S/kg> (1985S/kg) Application
                                                                                                                         Reduction in Compound Use
 Aerosol  Propellant
 Aerosol  Propellent

 Animal Labs

 Bee Hives

 Centrif  Chillers  (CFC-114)
 Centrif  Chillers  (CFC-114)

 Centrif  Chillers  (CFC-11)
 Centrif  Chillers  (CFC-11)
 Centrif  Chillers  (CFC-11)

 Centrif  Chillers  (CFC-12)
 Centrif  Chillers  (CFC-12)

 Centrif  Chillers  (CFC-500)
 Centrif  Chillers  (CFC-SOO)
Cnvyrzd
Cnvyrzd
Cnvyrzd
Cnvyrzd
Cnvyrzd
Cnvyrzd
Vapor
Vapor
Vapor
Vapor
Vapor
Vapor
Degreesing
Degreesing
Degreesing
Degreesing
Degreesing
Degreesing
Cold Cleaning
Cold Cleaning
Cold Cleaning
Cold Cleaning
Cold Cleaning
Cold Cleaning
Cold Cleaning

Cold Storage (CFC-12)
Cold Storage (CFC-12)
Cold Storage (CFC-12)
Cold Storage (CFC-12)

Commercial R&D Labs
Commercial RU> Labs
Commercial R&D Labs
Commercial R&D Labs
 Carbon Dioxide
 HCFC-22 Blends

 FC-134a

 FC-134a

 Recovery at Service and Disposal
 FC-134a

 Market Mix
 Recovery at Service and Disposal
 HCFC-123

 Recovery at Service and Disposal
 Alt  Leak Test  Gas

 Recovery at Service and Disposal
 Market Mix

 Aqueous Cleaning and Terpenes
 Carbon Adsorption and Drying Tunnel
 Reclaim Waste  Solvent
 CFC-113 Azeotropes
 Housekeeping Controls
 HCFC-123

 Petroleum Solvents
 Methyl  Chloroform
 Cover;  Drainage; &  Increased Freeboard
 Reclaim Waste  Solvent
 Housekeeping Controls
 CFC-113 Azeotropes
 HCFC-123

 Anrnonf a
 HCFC-22
 Alt Leak Test Gas
 CFC-502

Explosion Proof Condensation/Reclamation
N2 Purge then Pure EO
Acid-H20 Scrubber & Condensation/Reclamation
Contract Out
-0.74
2.21
3.24
3.24
0.47
4.35
0.00
1.60
3.02
0.74
1.26
-0.47
0.00
•16.60
-0.72
-0.36
0.00
0.00
2.73
-2.36
-1.34
-0.61
-0.32
0.00
0.00
2.73
-2.61
0.81
1.26
2.79
-3.25
-0.27
-0.24
0.00
-0.74
2.21
3.24
3.24
0.26
4.35
0.00
1.22
3.02
0.56
1.26
-0.68
0.00
-17.20
-1.51
-0.36
0.00
0.00
2.73
-2.36
-1.34
-0.64
-0.32
0.00
0.00
2.73
-2.61
0.81
1.26
2.79
-3.25
-0.41
-0.86
0.00
ii weigniea 	 	 .--.--.. 	 ................... 	 . 	
:ation CFC Use CFC-11 CFC-12 CFC-113 CFC- 114 CFC-115
49. 9X
49.9X
80.9X
87. 5X
24. OX
53. 2X
40. OX
7.5X
18. 4X
7.5X
4.8X
20. 3X
S3.5X
SO. OX
10.2X
1.2X
10. 4X
7. OX
2.2X
40. OX
21. OX
2.9X
1.1X
8.8X
7. IX
0.7X
10. OX
26.8X
2.3X
26.8X
15. OX
38.3X
4.7X
8.4X
2.210X
2.210X
O.OOOX
O.OOOX
0.087X
0.193X
1.025X
0.192X
0.472X
0.070X
0.045X
0.062X
0.164X
3.525X
0.719X
0.084X
0.735X
0.496X
0.157X
0.690X
0.363X
0.050X
0.019X
0.151X
0.122X
0.012X
0.121X
0.324X
0.028X
0.324X
0.008X
0.021X
0.003X
0.005X
2.85X 2.60X
2.85X 2.60X
O.OOX
O.OOX

3.30X
0.62X
1.52X
0.14X
0.09X
0.17X
0.44X


0.24X
0.64X
0.06X
0.64X
0.02X
0.04X
0.01X
0.01X



5.71X
12.65X



22.74X
4.64X
O.S4X
4.74X
3.20X
1.01X
4.45X
2.34X
0.32X
0.12X
0.97X
0.79X
0.07X


Contract Sterilization
                    Explosion Proof Condensation/Reclamation
                                                                                      -2.34
                                                                                   -2.34
                                                                                  IS.OX   0.089X
0.17X

-------
 Control Options Simulated
 Year:              1998
 Cost Curve:         Case 2
 Use Scenario:       Middle Growth
 Regulatory Option:  CFC SOX/Halon  Freeze
 Simulated CFC  Price Increase: % 4.49

          Application
                    Control  Option
                                                      Weighted   Weighted   Reduction   Reduction
                                                       Trigger    Social    in CFC Use   in  Total
                                                        Price      Cost        for       Weighted	
                                                      (198S$/kg) (1985S/kg) Application   CFC Use    CFC-11   CFC-12  CFC-113   CFC-114 CFC-115
                                                                                                           Reduction in Compound-Use
 Contract Sterilization
 Contract Sterilization

 Dehumidifiers

 Dry Cleaning
 Dry Cleaning
 Dry Cleaning
 Dry Cleaning

 Ext PS Bdstk
 Ext PS Bdstk

 Ext PS Sht
 Ext PS Sht
 Ext PS Sht
 Ext PS Sht
 Ext PS Sht

 Flex PU Foam-Molded
 Flex PU Foam-Molded
 Flex PU Foam-Molded

 Flex PU Foam-Slabstock
 Flex PU Foam-Slabstock

 Freezers

 Hospitals
 Hospitals
 Hospitals
 Hospitals

 Liquid  Food Freezing

Medical Equipment
Medical Equipment
Medical Equipment
Medical Equipment

Mobile Air Conditioners
Mobile Air Conditioners
Mobile Air Conditioners
Mobile Air Conditioners
 N2 Purge then Pure EO
 Acid-HZO Scrubber & Condensation/Reclamation

 Recovery at Rework

 Refrigerated Condenser
 Aqueous Cleaning
 Reclaim Wastes
 PerchIoroethyIene

 HCFC-22
 FC-134a

 Product Substitutes  for Single Service Plates; Cups;
 Product Substitutes  for Egg Cartons
 HCFC-22
 Product Substitutes  for Stock Food Trays
 Product Substitutes  for Hinged Containers

 CFC-141b
 HDI-TDI/Water-Blown  Systems in HR Process
 HCFC-123

 CFC-U1b
 HCFC-123

 Recovery at Rework

 Contract Out
 Steam Cleaning
 Disposables
 C02 (10/90 EO/C02)
Air Blast
                                   at ion
Explosion Proof Condensetion/RecIt
N2 Purge then Pure EO
Acid-H20 Scrubber & Condensation/Reclamation
Contract Out

Recovery at Service and Quality Engineering
Proprietary Organic/75-85X CFC-12
Recovery at Service --  Large Shops
Recovery at Service --  Medium Shops
                                                          -0.36
                                                          -0.17

                                                           0.73
  0.07

  0.00
  0.00
  0.00
  1.55

 -1.18

 -2.31
 -0.20
 -O.t7
  0.00

-11.59
  0.00
  1.84
  4.49
             -0.48
             -0.62

              0.20
-2.64
-0.64
0.75
2.44
0.00
3.93
0.00
0.00
0.00
0.00
0.00
1.90
1.95
3.52
1.90
3.52
-3.01
-1.14
0.75
0.79
0.00
3.93
0.00
0.00
0.00
0.00
0.00
1.90
1.19
3.52
1.90
3.52
 -0.50

  0.00
  0.00
  0.00
  1.17

 -1.57

 -2.31
 -0.37
 -0.61
  0.00

-12.09
  0.00
  0.73
  2.53
               51.OX
               17. OX
0.301X
0.100X
                                                                                   1.8X    0.003X
21 .8X
3.4X
1.2X
73. 7X
90. IX
10. OX
2.7X
2. OX
89.9X
3.9X
1.4X
35. 6X
63. 3X
1.0X
35. 6X
20. IX
1.3X
5. OX
10.0X
35.0X
35. OX
40. IX
4. OX
47.8X
1.9X
23. OX
7. OX
18.6X
6.5X
19.2X
0.114X
0.018X
0.006X
0.385X
1.238X
0.138X
0.078X
0.058X
2.618X
0.1 14X
0.041X
0.547X
0.972X
0.015X
1 .904X
1.075X
0.003X
0.161X
0.322X
1.131X
1.131X
0.560X
0.059X
0.698X
0.028X
0.336X
1.763X
4.682X
1 .635X
4.834X



1.76X
3.13X
0.05X
6.13X
3.46X





0.59X
0.20X

O.OOX
                                                                                                                    0.73X
                                                                                                                    0.12X
                                                                                                                    0.04X
                                                                                                                    2.48X
                                                                                                            2.43X
                                                                                                            0.27X

                                                                                                            0.15X
                                                                                                            0.11X
                                                                                                            5.14X
                                                                                                            0.22X
                                                                                                            0.08X
                 0.01X

                 0.32X
                 0.63X
                 2.22X
                 2.22X

                 1.10X

                 0.12X
                 1.37X
                 0.06X
                 0.66X

                 3.46X
                 9.19X
                -3.21X
                9.49X
Open Top Vpr Degreesing
Refrigerated Freeboard Chiller
                                                        -11.81
           -12.04
               5.8X    0.344X
                                                                                                                    2.22X

-------
 Control Options Simulated
 Year:              1998
 Cost Curve:        Case 2
 Use Scenario:      Middle Growth
 Regulatory Option:  CFC 50X/Halon Freeze
 Simulated CFC Price Increase: $ 4.49
          Application
          Vpr Degreesing
          Vpr Degreesing
          Vpr Degreesing
          Vpr Degreesing
          Vpr Degreesing
          Vpr Degreesing
          Vpr Degreesing
          Vpr Degreesing
Open Top
Open Top
Open Top
Open Top
Open Top
Open Top
Open Top
Open Top

PE Foam
PE Foam
PE Foam
 Pharmaceutical
 Pharmaceutical
 Pharmaceutical
 Pharmaceutical

 Phenolic Foam
 Phenolic Foam
 Phenolic Foam

 Polypropylene Foam
 Polypropylene Foam

 Process Refrig
 Process Refrig
 Process Refrig
 Process Refrig

 Reciprocating Chillers
 Reciprocating Chillers

 Refrigerated Transport
 Refrigerated Transport

 Refrigerators

 Retail Food (CFC-12)
Retail Food (CFC-12)
Retail Food (CFC-12)
Retail Food (CFC-12)

Rgd PU Foam-BStk-Cns-Ind
Rgd PU Foam-BStk-Cns-Ind
Rgd PU Foam-BStk-Cns-Ind
                                                Control Option
                                                       Weighted  Weighted   Reduction  Reduction
                                                        Trigger    Social     in CFC Use   in Total
                                                         Price     Cost        for
                                                      (1985S/kg)  (1985$/kg) Application
                                                                                                                                       Reduction in Compound Use
 Aqueous Cleaning end Terpenes
 Manual Cover; Drainage; Increased Freeboard;  & Thermo
 CFC-113 Automatic Cover
 Reclaim Waste Solvent
 CFC-113 Azeotropes
 Housekeeping Controls
 CFC-113 Automated Hoist
 HCFC-123

 Alternate Packaging Materials
 Rubber or Plastic Floatation Devices
 HCFC-22

 Explosion Proof  Condensation/Reclamation
 Contract Out
 N2 Purge then Pure EO
 Acid-H20 Scrubber & Condensation/Reclamation

 Other  Insulation Materials-Equiv  Insul Capacity
 CFC-Ulb
 HCFC-123

 Alternate Packaging Materials
 Carbon Adsorption with  Recovery

 Hydrocarbons
 Ammonia
 HCFC-22
 CFC-502

 HCFC-22
 Alt Leak  Test Gas

 HCFC-22
 CFC-502

 Recovery at Rework

 HCFC-22
Alt Leak Test Gas-At Installation
CFC-S02
Recovery at Service and Disposal

Other Insulation Materials-Equiv Insul Capacity
Thick Fiberglass Belts
CFC-HIb
-11.65
-10.40
-1.55
-0.35
0.00
0.00
0,20
2.73
-9.87
-9.70
0.00
-5.76
0.00
0.28
0.97
0.50
1.76
2.68
-7.80
-1.53
-3.29
-2.61
0.81
2.79
0.63
0.89
0.63
2.77
-12.40
-10.75
-1.80
-0.35
0.00
0.00
-0.81
2.73
-9.87
-9.90
0.00
-5.76
0.00
-0.10
-0.36
0.50
1.76
2.68
-7.80
-1.59
-3.29
-2.61
0.81
2.79
0.63
0.89
0.63
2.77
                                                                                      -0.97

                                                                                       0.81
                                                                                         01
                                                                                         79
                                                                                         92
-1.20

 0.81
   01
   79
   15
                                                                                       0.50
                                                                                       0.50
                                                                                       1.60
 0.50
 0.50
 1.60
/I I
ration (
47.1X
0.5X
9.0X
1.1X
9.8X
6.6X
S.8X
1.0X
5. OX
2.9X
92. 3X
5. OX
16.9X
35. IX
10. 3X
80. IX
10. OX
10.0X
85. OX
12. OX
10.0X
22. 6X
22.6X
22. 6X
50.9X
3.3X
22. 5X
22. 5X
1.9X
24. 9X
2.7X
42.6X
13.2X
40. OX
18. OX
21 .OX
•eiynieu 	 	 ---
:FC use CFC- 11
2.793X
0.028X
0.536X
0.067X
0.583X
0.394X
0.344X
0.059X
0.072X
0.041X
1 .333X
0.013X
0.046X
0.095X
0.028X
0.470X 0.84X
0.059X 0.11X
0.059X 0.1 IX
0.752X 1.21X
0.106X 0.17X
0.033X
0.073X
0.073X
0.073X
0.101X
0.007X
0.059X
0.059X
0.015X
0.545X
0.059X
0.932X
0.289X
0.035X 0.11X
0.016X 0.05X
0.019X 0.06X
CFC-12 CFC-113 1
18.01X
0.18X
3.46X
0.43X
3.76X
2.54X
2.22X
0.38X
0.07X
0.04X
1.31X
0.03X
0.09X
0.19X
0.05X
1.35X
0.17X
0.17X

0.06X
0.14X
0.14X
0.14X
0.20X
0.01X
0.12X
0.12X
0.03X
1.07X
0.12X
1.83X
0.57X

CFC- 114 CFC-115

2.36X
1.35X
43.55X


24.62X
3.48X







-------
  Control  Options  Simulated
  Year:               1998
  Cost Curve:         Case 2
  Use Scenario:       Middle Growth
  Regulatory Option:  CFC 50X/Halon Freeze
  Simulated CFC Price Increase: $ 4.49

          Application
 Rgd PU Foam-BStk-Cns-Ind     HCFC-123
                                                 Control Option
                                                       Weighted   Weighted   Reduction  Reduction
                                                        Trigger    Social    in CFC Use  in Total
                                                         Price      Cost
                         Reduction in Compound Use
 Rgd PU Foam-Bstk-Cons-Bldg
 Rgd PU Foam-Bstk-Cons-Bldg
 Rgd PU Foaro-Bstk-Cons-Bldg
 Rgd PU Foam-Bstk-Cons-Bldg

 Rgd PU Foam-Lam-Cons-Bldg
 Rgd PU Foam-Lam-Cons-Bldg
 Rgd PU Foam-Lam-Cons-Bldg
 Rgd PU Foam-Lam-Cons-Bldg

 Rgd PU Foam-Prd-Cons-Bldg
 Rgd PU Foam-Prd-Cons-Bldg
 Rgd PU Foam-Prd-Cons-Bldg

 Rgd PU Foam-Prd-Cons-Ind
 Rgd PU Foam-Prd-Cons-Ind
 Rgd PU Foam-Prd-Cons-Ind

 Rgd PU Foam-Prd-Packaging
 Rgd PU Foam-Prd-Packaging
 Rgd PU Foam-Prd-Packaging
 Rgd PU Foam-Prd-Packaging
 Rgd PU Foam-Prd-Packaging

 Rgd PU Foam-Prd-Refrig
 Rgd PU Foam-Prd-Refrig
 Rgd PU Foam-Prd-Refrig
 Rgd PU Foam-Prd-Refrig

 Rgd PU Foam-Prd-Trans
 Rgd PU Foam-Prd-Trans
 Rgd PU Foam-Prd-Trans

 Rgd PU Foam-Spd-Cns-Bldg
 Rgd PU Foam-Spd-Cns-Bldg

 Rgd PU Foam-Spd-Cns-Ind
 Rgd PU Foam-Spd-Cns-Ind
 Rgd PU Foam-Spd-Cns-Ind

Rgd PU Foam-Spd-Trans
Rgd PU Foam-Spd-Trans

Spice fumigant
 Other Insulation Naterials-Equiv Insul Capacity
 Thick Fiberglass Batts/Thick Walls/Wide Stud Spacing
 CFC-141D
 HCFC-123

 Thick Fiberglass Batts/Thick Ualls/Conv Stud Spacing
 Other Insulation Naterials-Equiv Insul Capacity
 CFC-141b
 HCFC-123

 CFC-11/22
 CFC-141b
 HCFC-123

 CFC-11/22
 CFC-141b
 HCFC-123

 Other Packaging Materials
 EPS Bead Board
 H20 only (C02)
 CFC-141b
 HCFC-123

 CFC-11/H20
 CFC-11/22
 CFC-141b
 HCFC-123

 CFC-11/22
 CFC-H16
 HCFC-123

 CFC-1416
 HCFC-123

 Thick Fiberglass Batts
 CFC-1416
 HCFC-123

CFC-1416
HCFC-123

Explosion Proof Condensation/Reclamation
                                                                                         3.76
                                                                       3.77
0.50
0.50
1.60
3.77
0.50
0.50
1.60
3.77
0.30
1.54
3.70
0.30
1.54
3.50
27.65
17.06
-1.47
1.54
3.70
-0.48
0.30
1.54
3.70
0.30
1.54
3.50
1.59
3.55
0.50
1.59
3.55
1.59
3.55
0.50
0.50
1.60
3.77
0.50
0.50
1.60
3.77
0.30
1.54
3.70
0.30
1.54
3.50
-27.65
-17.06
-1.47
1.54
3.70
-0.48
0.30
1.54
3.70
0.30
1.54
3.50
1.59
3.55
0.50
1.59
3.55
1.59
3.55
VI 1
cation I
21. OX
80. OX
2. OX
9.0X
9. OX
10. OX
45. OX
22. 5X
22.6X
10.0X
45. OX
45. OX
10.0X
45. OX
45. OX
60.0X
24. OX
8.0X
4. OX
2.7X
10. OX
9. OX
40. 6X
27.0X
10. OX
45. IX
30.0X
50. OX
50.0X
20. OX
40.0X
40.0X
50. OX
33.4X
•ciymeu -
CFC Use
0.019X
1.007X
0.025X
0.113X
0.1 13X
0.596X
2.684X
1.339X
1 .345X
0.151X
0.682X
0.682X
0.024X
0.107X
0.107X
0.950X
0.380X
0.127X
0.063X
0.042X
0.431X
0.388X
1.748X
1.165X
0.157X
0.708X
0.471X
1.851X
1.851X
0.278X
0.555X
0.555X
0.293X
0.196X
CFC-11
0.06X
3.24X
0.08X
0.36X
0.37X
1.92X
8.64X
4.31X
4.33X
0.34X
1.55X
1.55X
0.05X
0.24X
0.24X
2.16X
0.86X
0.29X
0.14X
0.10X
0.98X
0.88X
3.97X
2.65X
0.36X
1.61X
1.07X
5. SOX
5. SOX
0.83X
1.6SX
1.65X
0.87X
0.58X
CFC-12 CFC-113 CFC-114 CFC-115



0.09X
0.39X
0.39X
0.01X
0.06X
0.06X
0.5SX
0.22X
0.07X
0.04X
0.02X
0.25X
0.22X
1.01X
0.67X
0.09X
0.41X
0.27X
0.28X
0.28X
0.04X
0.08X
0.08X
0.04X
0.03X
                                                                                       -4.88
                                                                     -4.88
10.OX    0.008X
                                                                                                                                        0.02X

-------
Control Options Simulated
Year:              1993
Cost Curve:        Case 2
Use Scenario:      Niddle Growth
Regulatory Option: CFC SOX/Halon Freeze
Simulated CFC Price Increase:  S 4.49
         Application
                                                Control Option
Spice fumigant
Spice fumigant
Acid-H20 Scrubber & Condensation/Reclamation
N2 Purge then Pure EO
                                                      Weighted  Weighted   Reduction  Reduction
                                                       Trigger   Social    in CFC Use   in Total
                                                        Price      Cost        for      Weighted
                                                     (1985S/kg)  (1985S/kg) Application  CFC Use
-0.36
-0.05
•1.29
-0.27
 3.9X
45.OX
0.003X
0.037X
                                                                                                                                      Reduction in Compound Use
                                                                                                                              CFC-11  CFC-12 CFC-113  CFC-114 CFC-115
0.01X
0.07X

-------
HALONS -- 1989

-------
Control Options Simulated
Year:              1989
Cost Curve:        Cases 1 & 2
Use Scenario:      Middle Growth
Regulatory Option: CFC SOX/Halon Freeze
Simulated Hal on Price Increase: S 0.00
Application Control Option
Local App Syst (Halon 1211)
Local App Syst (Halon 1211)
Local App Syst (Halon 1211)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1301)
Prt Military (Halon 1301)
Prt Military (Halon 1301)
Prt Military (Halon 1301)
PrtCiv Elect
PrtCiv Elect
PrtCiv Elect
PrtCiv Elect
PrtCiv FlamLqd
PrtCiv FlamLqd
PrtCiv FlamLqd
PrtCiv General
PrtCiv General
PrtCiv General
PrtCiv General
PrtCiv Res id
PrtCiv Resld
PrtCiv Res id
PrtCiv Resid
TF Military (Halon 1211)
TF Military (Halon 1211)
TF Military (Halon 1211)
TF Military (Halon 1301)
TF Military (Halon 1301)
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Reduce Test Scale
Reduce Test Frequency
Decrease Frequency of Tear-Down
Contained Discharge
Use VCRs and Films for Training
Increase Recovery at Service
Increase Recovery
Contained Discharge
Reduce Test Frequency
Reduce Test Scale
Contained Discharge
Use VCRs and Films for Training
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Use VCRs and Films for Training
Contained Discharge
Use VCRs and Films for Training
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Use VCRs and Films for Training
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Weighted Weighted Reduction R
Trigger Social in Halon Use i
Price Cost for W
(19B5*/kg) (1985*/kg) Application H
-4.38
-1.26
-1.04
-0.49
-0.33
-0.24
-0.01
-4.41
-4.39
-4.39
-4.35
-3.79
-0.01
-17.73
-0.99
-0.01
-0.01
-4.39
-3.06
-2.99
-1.16
-4.38
-2.99
-2.97
-4.39
-3.06
-2.99
-1.16
-4.40
-3.06
•2.99
-1.16
-4.29
-1.25
-1.04
-0.99
-0.93
-4.39
-1.56
-1.04
-0.49
-0.39
-0.24
-0.02
-4.41
-4.39
-4.39
-4.37
-3.96
-0.12
-18.45
-0.99
-0.01
-0.01
-4.40
-3.42
-3.51
-1.16
-4.39
-3.51
-3.32
-4.40
-3.42
-3.51
-1.16
-4.40
-3.42
-3.51
-1.16
-4.30
-1.55
-1.04
-0.99
-0.94
2.3X
1.1X
1.1X
2.5X
0.9X
0.9X
0.6X
1.3X
1.0X
0.1X
0.4X
1.0X
1.9X
0.1X
2.6X
0.7X
0.9X
3.3X
0.2X
0.4X
1.8X
2.7X
1.5X
0.7X
3.3X
0.2X
0.4X
1.6X
3.4X
0.1X
0.3X
1.1X
0.8X
1.7X
1.7X
0.9X
1.4X
eduction
n Total
einhted
Reduction
in Compound Use
alon Use Halon 1211 Halon 1301
0.007X
0.004X
0.004X
0.018X
0.006X
0.006X
0.004X
0.073X
0.059X
0.009X
0.023X
0.059X
0.107X
0.004X
0.102X
0.029X
0.035X
0.291X
0.019X
0.038X
0.162X
0.026X
0.014X
0.007X
0.052X
0.003X
0.006X
0.026X
0.047X
0.002X
0.004X
0.016X
O.OOOX
0.001X
0.001X
0.099X
0.160X
0.04X
0.02X
0.02X


0.39X
0.31X
0.04X
0.12X
0.31X
0.57X



1.53X
0.10X
0.20X
0.85X
0.14X
0.08X
0.04X
0.27X
0.02X
0.03X
0.14X
0.25X
0.01X
0.02X
o.oax
o.oox
o.oox
o.oox



0.02X
0.01X
0.01X
0.01X


o.oox
0.13X
0.04X
0.04X


















0.12X
0.20X

-------
Control Options Simulated
Year:              1989
Cost Curve:        Cases 1 S 2
Use Scenario:      Middle Growth
Regulatory Option: CFC SOX/Halon Freeze
Simulated Ha 1 on Price Increase: $ 0.00
Application Control Option
TF Military (Halon 1301)
TF Military (Halon 1301)
TFCiv Elect (Halon 1211)
TFCiv Elect (Halon 1211)
TFCiv Elect (Halon 1211)
TFCiv Elect (Halon 1301)
TFCiv Elect (Halon 1301)
TFCiv Elect (Halon 1301)
TFCiv Elect (Halon 1301)
TFCiv FlamLqd (Halon 1211)
TFCiv FlamLqd (Halon 1211)
TFCiv FlamLqd (Halon 1211}
TFCiv FlamLqd (Halon 1301)
TFCiv FlamLqd (Halon 1301)
TFCiv FlamLqd (Halon 1301)
TFCiv FlamLqd (Halon 1301)
TFCiv Other (Halon 1211)
TFCiv Other (Halon 1211)
TFCiv Other (Halon 1211)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
Decrease Frequency of Tear-Down
Increase Personnel Training
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Weighted Weighted Reduction R
Trigger Social in Halon Use ii
Price Cost for Ui
(198SS/kg) (1985S/kg) Application H,
-0.48
-0.03
-4.37
-1.26
-1.04
-0.99
-0.66
-0.48
-0.03
-4.42
-1.26
-1.04
-0.98
-0.66
-0.48
-0.03
-4.73
-1.27
-1.05
-0.99
-0.66
-0.48
-0.03
-0.48
-0.04
-4.38
-1.56
-1.04
-0.99
-0.77
-0.48
-0.04
-4.44
-1.56
-1,04
-0.98
-0.77
-0.48
-0.04
-4.74
-1.58
-1.05
-0.99
-0.77
-0.48
-0.04
1.4X
0.9X
2.3X
1.0X
1.0X
2.6X
0.8X
2.1X
0.5X
1.7X
2.6X
2.6X
2.0X
2. IX
2. IX
1.4X
2. IX
1.0X
1.0X
2.6X
0.9X
0.8X
0.6X
eduction
n Total
Reduction
in Compound
Use
alon Use Halon 1211 Halon 1301
0.159X
0.108X
0.003X
0.002X
0.002X
1.288X
0.397X
1 .045X
0.261X
O.OOOX
0.001X
0.001X
0.183X
0.188X
0.189X
0.127X
O.OOOX
O.OOOX
O.OOOX
0.159X
0.052X
0.050X
0.034X

0.02X
0.01X
0.01X

O.OOX
O.OOX
O.OOX

O.OOX
O.OOX
O.OOX

0.20X
0.13X

1.59X
0.49X
1.29X
0.32X

0.23X
0.23X
0.23X
0.16X

0.20X
0.06X
0.06X
0.04X

-------
HALONS -- 1991

-------
  Control Options Simulated
  Year:              1991
  Cost Curve:        Cases 1 & 2
  Use Scenario:      Niddle Growth
  Regulatory Option: CFC 50X/Halon Freeze
  Sinulated Halon Price Increase: t 0.00
          Application


 Local App Syst (Halon 1211)
 Local App Syst (Halon 1211)
 Local App Syst (Halon 1211)

 Local App Syst (Halon 1301)
 Local App Syst (Halon 1301)
 Local App Syst (Halon 1301)
 Local App Syst (Halon 1301)
                              Control Option
 Prt Military
 Prt Military
 Prt Military
 Prt Military
 Prt Military
 Prt Military
(Halon
(Halon
(Halon
(Halon
(Halon
(Halon
1211)
1211)
1211)
1211)
1211)
1211)
 Prt Military (Halon 1301)
 Prt Military (Halon 1301)
 Prt Military (Halon 1301)
 Prt Military (Halon 1301)

 PrtCiv Elect
 PrtCiv Elect
 PrtCiv Elect
 PrtCiv Elect

 PrtCiv Flantqd
 PrtCiv FlamLqd
 PrtCiv FlamLqd

 PrtCiv General
 PrtCiv General
 PrtCiv General
 PrtCiv General

 PrtCiv Resid
 PrtCiv Resid
PrtCiv Resid
PrtCiv Resid

TF Military (Halon 1211)
TF Military (Halon 1211)
TF Military (Halon 1211)

TF Military (Halon 1301)
TF Military (Halon 1301)
 Contained Discharge
 Increase Recovery
 Decrease Frequency of Tear-Down

 Contained Discharge
 Increase Recovery
 Decrease Frequency of Tear-Down
 Increase Personnel Training

 Reduce Test Scale
 Reduce Test Frequency
 Decrease Frequency of Tear-Down
 Contained Discharge
 Use VCRs and Films for Training
 Increase Recovery at Service

 Increase Recovery
 Contained Discharge
 Reduce Test Scale
 Reduce Test Frequency

 Contained Discharge
 Use VCRs and Films  for Training
 Increase Recovery
 Decrease Frequency  of  Tear-Down

 Contained Discharge
 Increase Recovery
 Use VCRs and Films  for Training

 Contained Discharge
 Use VCRs and Films  for Training
 Increase Recovery
 Decrease Frequency of Tear-Down

 Contained Discharge
 Use VCRs and Films for Training
 Increase Recovery
 Decrease Frequency of Tear-Down

 Contained Discharge
 Increase Recovery
Decrease Frequency of Tear-Down

Contained Discharge
 Increase Recovery
                                                   Weighted   Weighted   R
                                                    Trigger    Social   in
                                                     Price      Cost
                                                  (1985S/kg) (1985$/kg) Application
-4.38
-1.26
-1.04
-0.49
-0.33
-0.24
-0.01
-4.41
-4.39
-4.39
-4.35
-3.79
-0.01
-17.73
-0.99
-0.01
-0.01
-4.39
-3.06
-2.99
-1.16
-4.38
-2.99
-2.97
-4.39
-3.06
-2.99
-1.16
-4.40
-3.06
-2.99
-1.16
-4.29
-1.25
-1.04
•0.99
-0.93
-4.39
-1.56
-1.04
-0.49
-0.39
-0.24
-0.02
-4.41
-4.39
-4.39
-4.37
-3.96
-0.12
-18.45
-0.99
-0.01
-0.01
-4.40
-3.42
-3.51
-1.16
-4.39
-3.51
-3.32
-4.40
-3.42
-3.51
-1.16
-4.40
-3.42
-3.51
-1.16
-4.30
-1.55
-1.04
-0.99
-0.94
tion f
on Use i
r V
at ion H
2.3X
1.9X
1.9X
2.5X
1.5X
1.5X
1.0X
2. IX
1.7X
0.2X
0.4X
1.7X
3. IX
0.2X
2.6X
1.SX
1.2X
3.3X
0.4X
0.7X
2.4X
2.7X
2.4X
1.2X
3.3X
0.4X
0.6X
2.2X
3.4X
0.2X
0.4X
1.5X
1.3X
2.8X
2.8X
1.4X
2.3X
[eduction
in Total
leighted
Reduction
in Compound Use
lalon Use Halon 1211 Halon 1301
0.007X
0.006X
0.006X
0.018X
0.011X
0.011X
0.007X
0.122X
0.098X
0.011X
0.023X
0.098X
0.179X
0.007X
0.102X
0.059X
0.048X
0.291X
0.032X
0.063X
0.215X
0.026X
0.024X
0.012X
0.052X
0.006X
0.010X
0.035X
0.047X
0.003X
0.006X
0.021X
O.OOOX
0.001X
0.001X
0.164X
0.267X
0.04X
0.03X
0.03X




0.64X
0.51X
0.06X
0.12X
0.51X
0.94X




1.53X
0.17X
0.33X
1.13X
0.14X
0.13X
0.06X
0.27X
0.03X
0.05X
0.18X
0.25X
0.02X
0.03X
0.11X
O.OOX
0.01X
0.01X





0.02X
0.01X
0.01X
0.01X






0.01X
0.13X
0.07X
0.06X


















0.20X
0.33X

-------
 Control Options Simulated
 YeBr:               1991
 Cost Curve:         Cases 1 ft 2
 Use Scenario:       Middle Growth
 Regulatory Option:  CFC SOX/Halon Freeze
 Simulated Halon Price Increase: * 0.00
         Application
 TF Military (Halon 1301)
 TF Military (Halon 1301)

 TFCiv Elect (Halon 1211)
 TFCiv Elect (Halon 1211)
 TFCiv Elect (Halon 1211)

 TFCiv Elect (Halon 1301)
 TFCiv Elect (Halon 1301)
 TFCiv Elect (Halon 1301)
 TFCiv Elect (Halon 1301)

 TFCiv FlamLqd (Halon 1211)
 TFCiv FlamLqd (Halon 1211)
 TFCiv FlamLqd (Halon 1211)

 TFCiv FlamLqd (Halon 1301)
 TFCiv FlamLqd (Halon 1301)
 TFCiv FlamLqd (Halon 1301)
 TFCiv FlamLqd (Halon 1301)

 TFCiv Other (Halon 1211)
TFCiv Other (Halon 1211)
TFCiv Other (Halon 1211)

TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
              Control  Option
 Weighted   Weighted   Re
  Trigger    Social    in
   Price      Cost        for
<1985*/kg) (1985S/kg)  Application
 Decrease Frequency of  Tear-Down
 Increase Personnel Training

 Contained Discharge
 Increase Recovery
 Decrease Frequency of  Tear-Down

 Contained Discharge
 Increase Recovery
 Decrease Frequency of  Tear-Down
 Increase Personnel  Training

 Contained Discharge
 Increase Recovery
 Decrease Frequency of  Tear-Down

 Contained Discharge
 Increase Recovery
 Decrease Frequency of  Tear-Down
 Increase Personnel Training

 Contained Discharge
 Increase Recovery
Decrease  Frequency of Tear-Down

Contained Discharge
 Increase Recovery
Decrease Frequency of Tear-Down
 Increase Personnel.Training
-0.48
-0.03
-4.37
-1.26
-1.04
-0.99
-0.66
-0.48
-0.03
-4.42
-1.26
-1.04
-0.98
-0.66
-0.48
-0.03
-4.73
-1.27
-1.05
-0.99
-0.66
-0.48
-0.03
-0.48
-0.04
-4.38
-1.56
-1.04
-0.99
-0.77
-0.48
-0.04
-4.44
-1.56
-1.04
-0.98
-0.77
-0.48
-0.04
-4.74
-1.58
-1.05
-0.99
-0.77
-0.48
-0.04
:ion R
>n Use i
W
it ion H
2.3X
1.6X
2.3X
1.7X
1.7X
2.6X
1.3X
2.1X
0.9X
1.7X
4.3X
4.3X
2. OX
3.4X
3.4X
2.3X
2. IX
1.7X
1.7X
2.6X
1.4X
1.4X
0.9X
eduction
n Total
oiahtAH ...
Reduction
in Compound Use
alon Use Halon 1211 Halon 1301
0.265X
0.1 79*
0.003X
0.003X
0.003X
1.288X
0.662X
1 .045X
0.434X
O.OOOX
0.001X
0.001X
0.183X
0.313X
0.315X
0.212X
O.OOOX
O.OOOX
O.OOOX
0.1S9X
0.087X
0.084X
0.057X

0.02X
0.01X
0.01X

O.OOX
0.01X
0.01X

O.OOX
O.OOX
O.OOX

0.33X
0.22X

1.59X
0.82X
1.29X
0.54X

0.23X
0.39X
0.39X
0.26X

0.20X
0.11X
0.10X
0.07X

-------
HALONS -- 1993

-------
Control Options Simulated
Tear:              1993
Cost Curve:        Cases 1 & 2
Use Scenario:      Middle Growth
Regulatory Option: CFC 50X/Halon Freeze Weighted Weighted Reduction R
Simulated Halon Price Increase: $ 0.49 Trigger Social in Halon Use i
Price Cost - for W
Application Control Option (1985»/kg) (1985*/kg) Application H
Local App Syst (Halon 1211)
Local App Syst (Halon 1211)
Local App Syst (Halon 1211)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1301)
Prt Military (Halon 1301)
Prt Military (Halon 1301)
Prt Military (Halon 1301)
Prt Military (Halon 1301)
Prt Military (Halon 1301)
PrtCiv Elect
PrtCiv Elect
PrtCiv Elect
PrtCiv Elect
PrtCiv FlamLqd
PrtCiv FlamLqd
PrtCiv FlamLqd
PrtCiv FlamLqd
PrtCiv General
PrtCiv General
PrtCiv General
PrtCiv General
PrtCiv Resid
PrtCiv Resid
PrtCiv Resid
PrtCiv Resid
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Use Alternative Test to Replace Discharg
Use Alternative Agent for Discharge Test
Use Non-Destructive Test Methods
Reduce Test Scale
Reduce Test Frequency
Decrease Frequency of Tear-Down
Contained Discharge
Use VCRs and Films for Training
Increase Recovery at Service
Decrease Frequency of Tear-Down
Increase Recovery
Contained Discharge
Reduce Test Scale
Reduce Test Frequency
Use VCRs and Films for Training
Contained Discharge
Use VCRs and Films for Training
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Use VCRs and Films for Training
Decrease Frequency of Tear-Down
Contained Discharge
Use VCRs and Films for Training
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Use VCRs and Films for Training
Increase Recovery
Decrease Frequency of Tear -Down
-4.38
-1.26
-1.04
-0.49
-0.33
-0.24
-0.01
O.OS
0.22
0.25
-4.41
-4.39
-4.39
-4.35
-3.79
-0.01
-19.24
-17.73
-0.99
-0.01
-0.01
0.27
-4.39
-3.06
-2.99
-1.16
-4.38
-2.99
-2.97
-1.16
-4.39
-3.06
-2.99
-1.16
-4.40
-3.06
-2.99
-1.16
-4.39
-1.56
-1.04
-0.49
-0.39
-0.24
-0.02
-0.27
0.09
0.25
-4.41
-4.39
. -4.39
-4.37
-3.96
-0.12
-19.24
-18.45
-0.99
-0.01
-0.01
0.19
-4.40
-3.42
-3.51
-1.16
-4.39
-3.51
-3.32
-1.16
-4.40
-3.42
-3.51
-1.16
-4.40
-3.42
-3.51
-1.16
2.3X
2.3X
2.6X
2.5X
1.8X
2. IX
1.4X
1.3X
9.7X
5. IX
3. OX
2.4X
0.2X
0.4X
2.4X
4.4X
O.OX
0.2X
2.6X
2. IX
1.7X
1.7X
3.3X
0.5X
1.0X
2.4X
2.7X
3.4X
1.7X
4.3X
3.3X
0.5X
0.9X
2.2X
3.4X
0.3X
0.6X
1.5X
eduction
n Total
aS nKfr^*4
Reduction
in Compound
Use
alon Use Halon 1211 Halon 1301
0.007X
0.007X
0.008X
0.018X
0.013X
0.015X
0.010X
0.009X
0.070X
0.037X
0.171X
0.137X
0.011X
0.023X
0.137X
0.251X
0.002X
0.008X
0.102X
0.083X
0.067X
0.067X
0.291X
0.044X
0.08BX
0.215X
0.026X
0.033X
0.016X
0.043X
0.052X
0.008X
0.014X
0.035X
0.047X
0.004X
0.008X
0.021X
0.04X
0.04X
0.04X







0.90X
0.72X
0.06X
0.12X
0.72X
1.32X






1.53X
0.23X
0.46X
1.13X
0.14X
0.18X
0.09X
0.22X
0.27X
0.04X
0.07X
0.18X
0.25X
0.02X
0.04X
0.11X



0.02X
0.02X
0.02X
0.01X
0.01X
0.09X
0.05X






O.OOX
0.01X
0.13X
0.10X
0.08X
0.08X

















-------
Control Options Simulated
Tear:              1993
Cost Curve:        Cases 1 & 2
Use Scenario:      Middle Growth
Regulatory Option: CFC SOVHalon Freeze Weighted Weighted Reduction R
Simulated Ha I on Price Increase: * 0.49 Trigger Social in Ha I on Use ii
... Price Cost for U
Application Control Option (1985$/kg) (1985*/kg> Application H
TF Military (Halon 1211)
TF Military (Halon 1211)
TF Military (Halon 1211)
TF Military (Halon 1301)
TF Military (Halon 1301)
TF Military (Halon 1301)
TF Military (Halon 1301)
TF Military (Halon 1301)
TF Military (Halon 1301)
TFCiv Elect (Halon 1211)
TFCiv Elect (Halon 1211)
TFCiv Elect (Halon 1211)
TFCiv Elect (Halon 1301)
TFCiv Elect (Halon 1301)
TFCiv Elect (Halon 1301)
TFCiv Elect (Halon 1301)
TFCiv Elect (Halon 1301)
TFCiv Elect (Halon 1301)
TFCiv FlamLqd (Halon 1211)
TFCiv FlamLqd (Halon 1211)
TFCiv FlamLqd (Halon 1211)
TFCiv FlamLqd (Halon 1301)
TFCiv FlamLqd (Halon 1301)
TFCiv FlamLqd (Halon 1301)
TFCiv FlamLqd (Halon 1301)
TFCiv FlamLqd (Halon 1301)
TFCiv FlamLqd (Halon 1301)
TFCiv Other (Halon 1211)
TFCiv Other (Halon 1211)
TFCiv Other (Halon 1211)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Use Alternative Test to Replace Dtscharg
Use Non-Destructive Test Methods
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Use Alternative Test to Replace Discharg
Use Non-Destructive Test Methods
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Use Alternative Test to Replace Discharg
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Use Non-Destructive Test Methods
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Use Alternative Test to Replace Discharg
Use Non-Destructive Test Methods
-4.29
-1.25
-1.04
-0.99
-0.93
-0.48
-0.03
0.11
0.49
-4.37
-1.26
-1.04
-0.99
-0.66
-0.48
-0.03
0.11
0.49
-4.42
-1.26
-1.04
-0.98
-0.92
-0.66
-0.48
-0.03
0.49
-4.73
•1.27
-1.05
-0.99
-0.66
-0.48
-0.03
0.11
0.49
-4.30
-1.55
-1.04
-0.99
-0.94
-0.48
-0.04
-0.54
0.49
-4.38
. -1.56
-1.04
-0.99
-0.77
-0.48
-0.04
-0.53
0.49
-4.44
-1.56
-1.04
-0.98
-1.19
-0.77
-0.48
-0.04
0.49
-4.74
-1.58
-1.05
-0.99
-0.77
-0.48
-0.04
-0.54
0.49
1.8X
3.4X
4. OX
2. OX
2.8X
3.2X
2.2X
1.2X
4.7X
2.3X
2. IX
2.4X
2.6X
1.6X
2.1X
1.2X
1.3X
5.2X
1.7X
5.2X
6.1X
2.0X
1.0X
4.1X
4.8X
3.2X
4. IX
2. IX
2. IX
2.4X
2.6X
1.7X
1.9X
1.3X
1.3X
5.2X
eduction
n Total
pi ah ted - • •
Reduction
in Compound
Use
alon Use Halon 1211 Halon 1301
0.001X
0.001X
0.001X
0.231X
0.321X
0.371X
0.250X
0.134X
0.539X
0.003X
0.003X
0.004X
1.288X
0.794X
1.045X
0.608X
0.638X
2.584X
O.OOOX
0.001X
0.002X
0.183X
0.094X
0.376X
0.441X
0.296X
0.376X
O.OOOX
O.OOOX
O.OOOX
0.159X
0.104X
0.117X
0.080X
0.079X
0.317X
O.OOX
0.01X
0.01X






0.02X
0.02X
0.02X






O.OOX
0.01X
0.01X






O.OOX
O.OOX
O.OOX









0.29X
0.40X
0.46X
0.31X
0.17X
0.67X



1.59X
0.98X
1.29X
0.75X
0.79X
3.19X



0.23X
0.12X
0.46X
0.54X
0.37X
0.46X



0.20X
0.13X
0.15X
0.10X
0.10X
D.39X

-------
HALONS -- 1998

-------
Control Options Simulated
rear:              1998
Cost Curve:        Cases 1 & 2
Use Scenario:      Middle Growth
Regulatory Option: CFC 50X/Haton Freeze Weighted Weighted Reduction Re
Simulated Ha I on Price Increase: * 0.49 Trigger Social in Ha I on Use ir
Price Cost for We
Application Control Option (1985*/kg) <1985S/kg) Application Hi
Local App Syst (Ha Ion 1211)
Local App Syst (Halon 1211)
Local App Syst (Halon 1211)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Local App Syst (Halon 1301)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1211)
Prt Military (Halon 1301)
Prt Military (Halon 130t)
Prt Military (Halon 1301)
Prt Military (Halon 1301)
Prt Military (Halon 1301)
Prt Military (Halon 1301)
PrtCiv Elect
PrtCiv Elect
PrtCiv Elect
PrtCiv Elect
PrtCiv FlaraLqd
PrtCiv FlamLqd
PrtCiv FlamLqd
PrtCiv FlamLqd
PrtCiv General
PrtCiv General
PrtCiv General
PrtCiv General
PrtCiv Resid
PrtCiv Resid
PrtCiv Resid
PrtCiv Resid
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Use Alternative Test to Replace Discharg
Use Alternative Agent for Discharge Test
Use Non-Destructive Test Methods
Reduce Test Scale
Decrease Frequency of Tear-Down
Reduce Test Frequency
Contained Discharge
Use VCRs and Films for Training
Increase Recovery at Service
Decrease Frequency of Tear-Down
Increase Recovery
Contained Discharge
Reduce Test Scale
Reduce Test Frequency
Use VCRs and Films for Training
Contained Discharge
Use VCRs and Films for Training
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Use VCRs and Films for Training
Decrease Frequency of Tear-Down
Contained Discharge
Use VCRs and Films for Training
Increase Recovery
Decrease Frequency of Tear -Down
Contained Discharge
Use VCRs and Films for Training
Increase Recovery
Decrease Frequency of Tear-Down
-4.38
-1.26
-1.04
-0.49
-0.33
-0.24
-0.01
0.05
0.22
0.2S
-4.41
-4.39
-4.39
-4.35
-3.79
-0.01
-19.24
-17.73
-0.99
-0.01
-0.01
0.27
-4.39
-3.06
-2.99
-1.16
-4.38
-2.99
-2.97
-1.16
-4.39
-3.06
-2.99
-1.16
-4.40
-3.06
-2,99
-1.16
-4.39
-1.56
-1.04
-0.49
-0.39
-0.24
-0.02
-0.27
0.09
0.25
-4.41
-4.39
-4.39
-4.37
-3.96
-0.12
-19.24
-18.45
-0.99
-0.01
-0.01
0.19
-4.40
-3.42
-3.51
-1.16
-4.39
-3.51
-3.32
-1.16
-4.40
-3.42
-3.51
-1.16
-4.40
-3.42
-3.51
•1.16
2.3X
2.3%
3. OX
2.5X
1.8X
2.4X
1.6X
4.5X
9.7X
5. IX
3.0X
0.2X
2.4X
0.4X
2.4X
4.4X
0.1X
0.2X
2.6X
2. IX
1.7X
1.7X
3.3X
0.5X
1.0X
2.4X
2.7X
3.4X
1.9X
8.7X
3.3X
0.5X
0.9X
2.2X
3.4X
0.3X
0.6X
1.5X
Auction
i Total
• -.tk^juj
Reduction
in Compound
Use
rigntea 	
ilon Use Halon 1211 Halon 1301
0.007X
0.007X
0.010X
0.018X
0.013X
0.017X
0.012X
0.032X
0.070X
0.037X
0.171X
0.011X
0.137X
0.023X
0.137X
0.251X
0.004%
0.008X
0.102X
0.083X
0.067X
0.067X
0.291X
0.044X
0.088X
0.215X
0.026X
0.033X
0.019X
0.085X
0.052X
0.008X
0.014X
0.035X
0.047X
0.004X
0.008X
0.021X
0.04X
0.04X
0.05X







0.90X
0.06X
0.72X
0.1 2X
0.72X
1.32X





1.53X
0.23X
0.46X
1.13X
0.14X
0.18X
0.10X
0.45X
0.27X
0.04X
0.07X
04 BV
.iBX
0.25X
0.02X
0.04X
0.11X



0.02X
0.02X
0.02X
0.01X
0.04X
0.09X
0.05X






O.OOX
Q.01X
0.13X
0.10X
0.08X
0.08X














-------
Control Options Simulated
Year:              1998
Cost Curve:        Cases 1 & 2
Use Scenario:      Middle Growth
s?^!!^yH0i>tl02:-CFC,50X/Mal0n«Fne^e Weighted Weighted Reduction R
Simulated Ha 1 on Price Increase: $ 0.49 Trigger Social in Halon Use i
.... Price Cost for U
Application Control Option (1985S/kg) (1985$/kg) Application H
TF Military (Halon 1211)
TF Military (Halon 1211)
TF Military (Halon 1211)
TF Military (Halon 1301)
TF Military (Halon 1301)
TF Military (Halon 1301)
TF Military (Halon 1301)
TF Military (Halon 1301)
TF Military (Halon 1301)
TFCiv Elect (Halon 1211)
TFCiv Elect (Halon 1211)
TFCiv Elect (Halon 1211)
TFCiv Elect (Halon 1301)
TFCiv Elect (Halon 1301)
TFCiv Elect (Halon 1301)
TFCiv Elect (Halon 1301)
TFCiv Elect (Halon 1301)
TFCiv Elect (Halon 1301)
TFCiv FlamLqd (Halon 1211)
TFCiv FlamLqd (Halon 1211)
TFCiv FlamLqd (Halon 1211)
TFCiv FlamLqd (Halon 1301)
TFCiv FlamLqd (Halon 1301)
TFCiv FlamLqd (Halon 1301)
TFCiv FlamLqd (Halon 1301)
TFCiv FlamLqd (Halon 1301)
TFCiv FlamLqd (Halon 1301)
TFCiv Other (Halon 1211)
TFCiv Other (Halon 1211)
TFCiv Other (Halon 1211)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
TFCiv Other (Halon 1301)
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Use Alternative Test to Replace Discharg
Use Non-Destructive Test Methods
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Use Alternative Test to Replace Discharg
Use Non-Destructive Test Methods
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Use Alternative Test to Replace Discharg
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Use Non-Destructive Test Methods
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Contained Discharge
Increase Recovery
Decrease Frequency of Tear-Down
Increase Personnel Training
Use Alternative Test to Replace Discharg
Use Non-Destructive Test Methods
-4.29
-1.25
-1.04
-0.99
-0.93
-0.48
-0.03
0.11
0.49
-4.37
-1.26
-1.04
-0.99
-0.66
-0.48
-0.03
0.11
0.49
-4.42
-1.26
-1.04
-0.98
-0.92
-0.66
-0.48
-0.03
0.49
-4.73
-1.27
-1.05
-0.99
-0.66
-0.48
-0.03
0.11
0.49
-4.30
-1.55
-1.04
-0.99
-0.94
-0.48
-0.04
-0.54
0.49
-4.38
-1.56
-1.04
-0.99
-0.77
-0.48
-0.04
-0.53
0.49
-4.44
-1.56
-1.04
-0.98
-1.19
-0.77
-0.48
-0.04
0.49
-4.74
-1.58
-1.05
-0.99
-0.77
-0.48
-0.04
-0.54
0.49
2. IX
3.4X
4.5X
2.3X
2.8X
3.7X
2.5X
4. IX
4.7X
2.3X
2. IX
2.8X
2.6X
1.6X
2. IX
1.4X
4.5X
5.2X
1.7X
5.2X
6.9X
2. OX
3.6X
4. IX
5.5X
3.7X
4. IX
2. IX
2. IX
2.8X
2.6X
1.7X
2.2X
1.5X
4.5X
5.2X
eduction
n Total
Reduction
in Compound Use
alon Use Halon 1211 Halon 1301
0.001X
0.001X
0.002X
0.263X
0.321X
0.424X
0.286X
0.470X
0.539X
0.003X
0.003X
0.004X
1.288X
0.794X
1.045X
0.695X
2.235X
2.584X
O.OOOX
0.001X
0.002X
0.183X
0.330X
0.376X
0.504X
0.339X
0.376X
O.OOOX
O.OOOX
0.001X
0.159X
0.104X
0.134X
0.092X
0.275X
0.317X
O.OOX
0.01X
0.01X

0.02X
0.02X
0.02X





O.OOX
0.01X
0.01X






O.OOX
O.OOX
O.OOX







0.33X
0.40X
0.52X
0.35X
0.58X
0.67X



1.59X
0.98X
1.29X
0.86X
2.76X
3.19X



0.23X
0.41X
0.46X
0.62X
0.42X
0.46X



0.20X
0.13X
0.17X
0.11X
0.34X
0.39X

-------
•V.

-------
                                   APPENDIX K

                INTERNATIONAL TRADE ISSUES AND THE UNEP PROTOCOL
                 TO REDUCE GLOBAL EMISSIONS OF CFCs AND HALONS
1.  INTRODUCTION

    The U.S. government has negotiated an agreement under the auspices of the
United Nations Environment Programme (UNEP) to reduce the use and emissions of
chlorofluorocarbons (CFCs) and halons in order to protect stratospheric ozone.
The Montreal Protocol on Substances That Deplete the Ozone Layer'- calls for a
near-term freeze and a long-term scheduled reduction of CFC emissions.  Under
the protocol halon production is to be frozen but not scheduled for reduction.

    One component of the agreement's approach to limiting global emissions of
CFCs and halons is to restrict trade by countries which are not parties to the
treaty.  The protocol trade restrictions apply to bulk CFCs/halons, products
containing CFCs/halons, and possibly products manufactured with but not
containing CFCs (such as electronic components cleaned with CFC solvents).
These trade controls are addressed in this paper.

    Section 2 analyzes the potential impacts of protocol trade controls.  It is
concluded that the protocol poses little risk to U.S. competitiveness and that
trade provisions provide strong incentives for countries to join, jAn overview
of the current situation regarding CFC and halon trade and protocol
implications for the competitiveness of U.S. industries is presented.  The
section next describes the potential impacts of the protocol's trade controls
for four affected groups:  countries party to the protocol (signatories);
countries not party to the protocol (non-signatories); U.S. CFC producers; and
U.S. producers of CFC end-user products.  The section next evaluates how the
trade control-related impacts may influence the decisions of various types of
countries to join the protocol, including:  industrial countries; newly
industrialized countries (NICs);  least developed countries; and large developing
countries.

    Section 3 analyzes the enforceability of protocol trade provisions, focusing
on the ability to monitor CFC and halon production and trade, and related
products in order to verify compliance.  It is concluded that the protocol can
be enforced with existing customs and agency authority.

    Section 4 evaluates the suitability of selected trade control mechanisms for
use in relation to CFCs, halons,  and related products.
       See Attachment K-l, Montreal Protocol on Substances That Deplete the
Ozone Layer. United Nations Environment Programme, 1987.

-------
                                      K-2
 2.  POTENTIAL IMPACTS OF CFG AND HALON TRADE CONTROLS

 2.1  CFC and Halon Trade and the Protocol:  Implications for the Competitiveness
     of U.S. Industries

    CFCs and halons can be traded in three general forms:  as bulk chemicals;  as
 CFCs and halons contained in products; and as products made with but not
 containing CFCs.

    Accurate data have not been compiled on trade of CFC and halon bulk
 chemicals.  Tariff schedules of most countries, including the United States, do
 not include specific breakouts for the various CFCs and halons.  It appears,
 however, that the U.S. is a net importer of CFC bulk chemicals, with imports
 accounting for between 5 percent and 10 percent of domestic U.S. CFC and halon
 use.

    Accurate data on trade of CFC and halon end-user products are readily
 available.  U.S. trade in CFC end-user products is more economically important
 than trade in CFC bulk chemicals.  U.S. imports of products that contain CFCs
 include automobiles, refrigerators, air conditioners and other products.
 Electronics components and consumer goods are examples of U.S. imported products
 made with but not containing CFCs.  The value of CFCs contained in, or used to
 manufacturer these imported products is very small compared with the large
 dollar value of the traded products.

    The U.S. Department of Commerce has conducted preliminary investigations of
 CFCs contained in selected products imported to the United States.  These
 indicate that only about 4.1 million pounds of CFCs are imported in automobile
 and light truck air conditioners; 2.5 million pounds of CFCs are in the
 refrigerant and insulation of imported refrigerators; and about 6,000 pounds of
 CFCs are in imported room air conditioners.  The total amount of CFCs in these
 products is about 6.6 million pounds, or roughly 3 million kilograms.  This is
 less than 2 percent of the total U.S. domestic production/use of about 200
 million kilograms.

    2.1.1  U.S.  COMPETITIVENESS

    Prices of CFCs and halons in the United States (and other protocol
 countries) can be expected to Increase under the UNEP protocol.  This will
 occur,  largely,  because of the restricted supply from protocol limits on CFC and
halon production and trade.    However, CFC and halon prices should not increase
 in countries which do not join the protocol.

    To the extent that a disparity in CFC and halon prices between the U.S. and
non-signatory countries results in higher costs of U.S. made, CFC-related and
halon-related products, U.S.  industries could become less competitive in the
     2 See Attachment K-2, "CFC Production/Use Data for Selected Industrial and
Developing Countries."

     * See Attachment K-l, "Article 2:  Control Measures," Montreal Protocol on
Substances That Deplete the Ozone Layer. United Nations Environment Programme,
1987.

-------
                                      K-3
U.S. and international markets for products dependent on significant quantities
of CFCs and halons.  Theoretically, U.S. exports of CFG and halon end-user
products could decline while like-product imports could increase from
non-signatory countries until imports are restricted under the protocol and/or
domestic regulation.  Transnational corporate producers of CFG-related products
might consider increasing production in non-protocol countries for export to the
United States.

    The competitiveness of U.S. CFG and halon producers and end-user industries
depends on four factors:

        •   protocol membership of the major CFG and halon producer
            countries;

        •   the existence of CFG and halon price differences between
            protocol signatory and non-signatory countries;

        •   the degree of CFG and halon dependence of individual
            end-user products; and,

        •   the existence of trade restrictions on CFG and halon
            bulk chemicals and end-user products between protocol
            signatory and non-signatory countries.

    The current and anticipated situation regarding each of these four factors
is such that the competitiveness of relevant U.S. industries should not be
greatly impaired.

    First, most major producers of CFCs, halons, and related products
participated in the UNEP negotiations to protect stratospheric ozone and have
either signed the Montreal Protocol or are expected to sign.-'

    Second, CFG and halon price differences are not expected prior to the
implementation of trade restrictions.  These should have little detrimental
effect on U.S. industries.  Because of the participation in the protocol of the
other major CFG and halon producing countries, they will be subject to similar
price increases as in the U.S., and thus not afford other countries' companies a
competitive advantage vis-a-vis U.S. industries.

    Third, an increase in the price of CFCs is not expected to substantially
increase the price of any CFC-related product, with the possible exception of
foam, due to both the limited cost share of CFC/halon per product and limited
product dependence on use of these chemicals.  Because foam is too bulky to ship
long distances, there is little risk of foreign competition.  For the vast
majority of air conditioners, refrigerators, automobiles, and electronics
products, the cost of CFCs is minor compared with the overall cost of the
     4 See section 2.2 below for more detailed analysis of potential protocol
impacts on U.S. industries and those of other signatory and non-signatory
countries.

     5 See section 2.3 below for a detailed discussion of trade factors
affecting country decisions to join the UNEP protocol.

-------
                                      K-4
product.  In most cases, CFC emissions can be reduced without significantly
increasing the price of final products.  For many of these products, close
substitutes for CFCs and halons. are available or in development.  For example,
in the case of electronics goods where CFCs are used as cleaning agents, aqueous
solutions, other solvents, and low-solids flux can often be used as a substitute
at about the same cost.

    Fourth, with regard to the ability of non-protocol countries to export less
costly CFCs and CFC-related products to the U.S. and other signatory countries,
the protocol will restrict trade in CFCs and halons, products containing CFCs
and halons, and possibly products made with but not containing CFCs.°  This will
effectively reduce the incentive for production of CFCs and halons, and products
containing CFCs and halons, to be initiated or increased in non-signatory
countries.

2.2  Implications of Protocol Trade Controls

    The Montreal protocol includes provisions to control trade in CFC and halon
bulk chemicals and CFC and halon end-user products.  The trade controls:

        •   ban imports of CFC and halon bulk chemicals from any
            country not party to the protocol;^

        •   ban the export by developing country signatories of CFC
            or halon bulk chemicals to non-signatory countries,

        •   ban imports of products containing CFCs and halons from
            non-signatory countries,

        •   will determine the feasibility of banning or restricting
            imports of products manufactured with, but not
            containing, CFCs from non-signatory countries, ® and

        •   may ban, restrict, or discourage exports to
            non-signatory countries technologies which produce or
            use CFCs and halons.11
     " The feasibility of restricting trade in products made with but not
containing CFCs will be determined at a later date.

     7 See Attachment K-l, "Article 4:  Control of Trade with Non-Parties,
Paragraph 1," Montreal Protocol on Substances That Deplete the Ozone Layer.
UNEP, 1987.

     8 See Attachment K-l, "Article 4:  Paragraph 2."

     9 See Attachment K-l, "Article 4:  Paragraph 3."

     10 See Attachment K-l, "Article 4:  Paragraph 4."

     11 See Attachment K-l, "Article 4:  Paragraph 5."

-------
                                      K-5
    We discuss, in turn, the potential impacts from the implementation of the
protocol's trade control provisions for four affected groups:   signatory
countries; non-signatory countries; U.S. CFG and halon producers;  and U.S.
producers of CFG end-user products.  The discussion is predicated on the
stringent trade control measures of the protocol.  Potential qualitative effects
are examined with regard to the following key variables:   product prices; trade
(export/import) effects; industry employment effects; consumer welfare effects;
and the incentive to develop/adopt alternative technologies.  A summary of
potential impacts of the Montreal Protocol's import ban provisions is presented
in Exhibit K-l.

    2.2.1  SIGNATORY COUNTRIES

    The potential impacts of the protocol's trade control provisions will vary
among signatory countries.  Many countries are CFG producers,  but some do not
have CFG production capacity and import CFCs for their domestic applications.

    Signatory countries will experience the following general impacts of the
protocol trade control provisions to ban imports of CFCs and halons, and CFC and
halon end-user products from non-signatory countries.

        0   Import ban on CFC and halon bulk chemicals from
            non-signatories.  Most signatory countries are self
            sufficient CFC/halon producers, net exporters of CFCs and
            halons, or are currently supplied by countries that have
            joined or are likely to join the protocol.  Import
            restrictions may contribute to slightly higher prices by
            limiting potential sources of supply. *  Imports of CFCs and
            halons from those countries not expected to join the
            protocol make up a very small share of the signatories'
            total supply.  The elimination of imports, therefore,  will
            cause only a negligible reduction in CFC and halon supply in
            the signatory countries.  Regulation-induced constraints on
            CFC and halon production will provide an incentive to
            develop new chemical substitutes.

        0   Import ban on products containing CFCs and halons from
            non-signatory countries.  Signatory countries could
            experience slightly greater impacts from a ban on imported
            products containing CFCs from non-signatory countries than
            that on CFC bulk chemical imports alone.  Countries not
            initially joining the protocol, such as some newly
            industrialized countries (NICs), are more significant
            producers and exporters of CFC end-user products (e.g.,
            automobiles and refrigerators) to signatory countries than
            of CFC bulk chemicals.
     " The main source of increases in CFC and Halon prices will be
attributable to the control costs of freezing and reducing CFC emissions,  as
stipulated in Article 2 of the Montreal Protocol.

-------
                                                                EXHIBIT K-l

                                      POIENIIAL IMPACTS OF THE UMEP PROTOCOL'S TRADE CONTHOU PROVISIONS
AFFECTED
PRODUCTS
OF PROTOCOL
IMPORT BAN
                                                             IMPACTED CROUPS
SIGNATORY
COUNTRIES
NON-SIGNATORV
 COUNTRIES	
 U.S. CFC
PRODUCERS
    U.S. END-USER
PRODUCERS/IMPORTERS
CFC Bulk      CFC prices may  Incroaaa
Chemicals     ilightly.  CFC  Import*
              decline  slightly.  CFC
              end-user product prices
              Increase marginally (e.g..
              foam products).  Domestic
              CFC producers  Increase
              profits  If higher
              revenues ara real lied.
Products      Prices  Increase for
Containing    products containing CFCs.
CFCs          Snail -a Ifare  loss for
              consumers.   Imports decline.
              Domestic Industry profits.
              output, and  employment
              increase to  substitute for
              Imports  In these products.
              Exports to non-signatories
              dec Una as prices Incraasa.
              but My  Increase among
              signatories

Products      Prices  Increase for
Manufactured  products eiada nlth CFCa.
Mllh CFCs     welfare loss for consumer*.
              Imports decline   Industry
              profits. Output and employ-
              ment  Increase to substitute
              for Imports.  Eiports to
              non-slgnatorlas decline.
              but may Increase among
              sIgnatorlas
                     CFC eiport earnings doc I In*
                     for producers.  Little
                     impact  for non-producers
                     (most)   Higher CFC Import
                     costs tor non-producers.
                     Possible  Incentive to
                     produce CFCs for domestic
                     use and e»porl to other
                     non-signatories.  Mild
                     incentive to Join protocol.
                     E«port earnings for
                     automobiles, refrigeration
                     and  11he products decline.
                     Industry loses profits.
                     employment.  Incentive to
                     adopt Substitute chemicals
                     and  applications to retain
                     market access In signatory
                     countries   Strong
                     Incentive to Join protocol.
                     Small effect due to limited
                     CFC Imports/eiports.  CFC
                     prlcas and producer
                     profits Incraasa slightly
                     In near-tarn,  dports
                     may doc Una to non-
                     slgnetorles due to higher
                     relative CFC prlcas vls-a-
                     vls non-signatory CFC
                     producers.  Employment
                     effects unclear.

                     Possible small CFC eiport
                     decline la non-signatory
                     producers of product* made
                     •Ith CFCs.  Incentive la
                     davalap substitute chemt-
                     cala for non-signatories
                     soaking to rataln market
                     access ta signatory markets.
                    Eiport earnings doc Una for
                    most electronics, furniture.*
                    and consumer products.
                    Industry  loses profits.
                    employment.  Incentive to
                    adopt Substitute chemicals
                    and applications to rataln
                    market access In signatory
                    countries   Strangest
                    Incentive to Join protocol.
                     Possible small CFC aiport
                     decline to non-signatory
                     producers of products
                     made ulth CFCa.
                     Incentive to develop
                     substitute chemical a for
                     non-slgnatorlos seeking
                     to rataln market access
                     to signatory markets.
                     Higher CFC prlcas have
                     greatest  Impact on  foam
                     Industry.  Other end-users
                     only marginally affected.
                     Incentive to develop non-
                     CFC products applleallona.
                     End-user product prices
                     Incraasa.  Possible small
                     doc I In* In aiports. but
                     Incroasa In domestic
                     output, employment and
                     profits.  U.S.  Importers
                     of product* containing
                     CFC* los* Inaipanslva
                     foreign aourcee of supply
                     profit* and employment.
                     Product prlcas Incraasa.
                     Dome*tic output, employ-
                     ment and profit* Incresse.
                     Importe decline sharply.
                     U.S. Importer* los*
                     sources of supply.
                     profit* and employment.
                     Impact could ba significant
                     for U.S. Importers of
                     electronic* If current
                     suppliers do not Join
                     protocol.

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                                      K-7
              The protocol's import ban on products containing
              CFCs and halons would have a'direct effect on
              end-user industries in signatory countries.
              Domestic producers could increase their production
              to offset the decline in imports, thus increasing
              domestic output and employment.  This would depend
              on the amount of imported products affected and will
              differ among individual signatory countries.

         •    Import ban on products manufactured with CFCs from
              non-signatory countries.  Restrictions of trade in
              products made with, but not containing CFCs, could cause
              the greatest impact of all protocol trade controls.  This
              category of products includes electronics, which are more
              important to exporting countries than bulk CFCs, and
              which account for a larger share of the product market in
              signatory countries than other CFC end-user product
              imports.

              The impact of an import ban on products made with but not
              containing CFCs could be significant on electronics
              prices, trade effects, domestic industry competitiveness,
              industry employment and consumer welfare.  For example,
              NICs have expanded their electronics industries in large
              part due to their competitive advantage in labor costs.
              If these electronics producing countries did not join the
              protocol there could be a price increase for electronics
              products imported to protocol signatories causing a
              reduction in consumer welfare.  Concurrently, domestic
              electronics industries in the signatory countries could
              experience increased production and employment.  However,
              in light of the far greater effects on the economies of
              electronics producing and exporting countries, it is
              likely that they will eventually join the protocol.

    2.2.2  NON-SIGNATORY COUNTRIES

    Non-signatories may be either developed or less developed countries (LDCs).
Differences among non-signatory countries exist which will influence how they
are affected by the implementation of the protocol's trade provisions.  Of
particular importance is the degree to which they produce and export CFCs and
CFC end-user products.

    The exports of all non-signatory countries to signatories may be banned for
the following products:

         •    CFC and halon bulk chemicals;

         •    Products containing CFCs and halons; and

         •    Products manufactured with, but not containing CFCs.

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                                      K-8
    Non-signatory countries may experience some of the following impacts if
signatory countries ban imports of CFCs and halons and CFG and halon end-user
products from non-signatories.

         •    Import ban on CFG and halon bulk chemicals from
              non-signatories.   Non-signatories that produce CFCs and
              halons for export to other non-signatory countries will
              experience a decline in demand for their chemical
              products due to trade restrictions in signatory countries'
              for CFC and halons plus end-user products.  The price,
              quantity sold, and related export earnings of CFC and
              halon producers in these non-signatory countries would be
              reduced.  If CFC and halon production have declining
              average costs, a reduction in quantity sold could cause
              an increase in per unit cost.  This could be the case for
              small volume CFC producers in developing countries.  Both
              the decline in accessible export markets and an increase
              in costs could reduce producer profits in non-signatory
              countries.

              For non-signatory countries,  which import CFCs and halons
              from signatory countries, CFC import prices may increase.
              CFC and halon end-user product producers would then face
              higher costs of production.   Non-signatory importers of
              CFCs and halons could turn to the few non-signatory CFC
              chemical producers,  offsetting part of the potential
              price and cost effects noted above.

         •    Import ban on products containing and/or manufactured
              with CFCs from non-signatory countries.   Non-signatory
              producers and exporters of products containing CFCs and
              halons or manufactured with but not containing CFCs would
              experience a decline in product demand in signatory
              country markets.   In these circumstances,  prices,
              products sold, and export revenues would decline.  These
              trade control provisions would have a greater effect on
              the non-signatory countries than would the ban on CFC and
              halon bulk chemical exports because the potential
              non-signatory countries are more significant producers
              and exporters of CFC end-user products,  such as
              automobiles and electronics,  than CFC and halon bulk
              chemicals.

              In addition, it is the signatory, industrial country
              markets that are the main export markets for the CFC
              end-user products whether of developing or industrial
              countries.  The desire to retain export markets would
              provide a strong incentive to join the protocol or to
              adopt non-CFC substitute chemicals and alternative
              industrial applications.

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                                      K-9
    2.2.3  U.S. CFG AND HALON PRODUCERS

    There are five major producers of CFCs in the United States:   Dupont;  Allied
Corporation; Racon; Kaiser;  and Pennwalt Corporation.  There are three producers
of halons in the U.S.:  DuPont; Imperial Chemical/Id Americas;  and Great Lakes
Chemical.  The impact on U.S. producers of a ban on imports of CFCs and halons
and CFC and halon end-user products from countries would be similar to that on
CFC and halon producers in other signatory countries.

         •    Import ban on CFC and halon bulk chemicals from
              non-signatories.   The protocol ban on imports of CFC and
              halon bulk chemicals from non-signatory countries should
              have a minimal effect on U.S. producers for two reasons:
              (1) the United States imports only a small amount of its
              domestic CFC and halon consumption; and, (2) these
              imports come from other industrial countries expected to
              sign the protocol, and therefore would not be subject to
              the trade control provisions."

              CFC and halon prices in signatory countries could be
              higher than in non-signatory countries.  In this case,
              CFC and halon exports by U.S. producers to non-signatory
              countries could decline as demand in these countries
              shifts to less expensive sources of CFCs in the few
              non-signatory CFC producing countries.  However, it is
              unlikely that this would have much effect on U.S.  CFC
              producers' profits, given the very low level of absolute
              U.S. exports and the likelihood that most countries which
              produce bulk chemicals will join the protocol.

         •    Import ban on products containing and/or manufactured
              with CFCs from non-signatory countries.  The small amount
              of bulk CFC and halon exports from U.S. producers may
              decline under an import ban on products containing and/or
              manufactured with CFCs from non-signatory countries.
              Industrial demand for CFCs in the non-signatory countries
              could decline as they lose market access for CFC and
              halon end-user products in the industrial signatory
              countries.  This should have a minimal effect on the
              profits of U.S. CFC and halon producers due to their
              small level of CFC and halon exports to countries that
              will not join the protocol.

    2.2.4  U.S. PRODUCERS/IMPORTERS OF CFC END-USER PRODUCTS

    The United States has numerous companies producing and/or importing CFC and
halon end-user products, such as:  automobiles, air conditioners, refrigerators,
electronics, fire extinguishers, and foam products.  These companies constitute
the source of industrial demand for CFCs and halons.  The impact on these
respective U.S. industries and companies of a ban on imports of CFCs and halons
and CFC and halon end-user products from non-signatory countries will differ
     13 See Attachment K-3,  Exhibits 1 and 2.

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                                     K-10
depending on several factors, including:  competitive industry-specific
characteristics; the CFC intensity of individual end-user products; and the
level of imports and exports of these products.

         •    Import ban on CFC and halon bulk chemicals from
              non-signatories.   The potential impact on U.S. producers
              of CFC and halon end-user products of an import ban on
              bulk chemicals from non-signatory countries will be
              minimal.  This is due to the very small amount of total
              CFC imports, and the fact that current U.S. suppliers of
              CFCs and halons will join or have joined the protocol.

         •    Import ban on products containing CFC and halons and/or
              manufactured with CFCs from non-signatory countries.
              U.S. producers and/or importers of CFC and halon end-user
              products will be more affected by a ban on imports of
              end-user products from non-signatory countries than a ban
              on bulk chemical imports.  The decline in supply of CFC
              and halon end-user products could cause an increase in
              the price of these products.  The extent of the price
              increase depends on the share of the U.S. market
              accounted for by end-user imports from non-signatory
              countries and the competitiveness of the market.
              Increased prices should stimulate U.S. domestic
              production and imports from protocol countries.  Domestic
              demand for labor will increase and, at least in the
              short-term, profits may increase as well.  Exports to
              non-signatory countries by U.S. producers of CFC end-user
              products will not decline significantly because CFCs are
              a small part of product cost.  Selected U.S. importers of
              CFC end-user products may experience significant losses
              if product sources of supply are eliminated by an import
              ban.  For example, automobile importers may lose these
              sources of supply if producer countries choose not to
              join in stratospheric ozone protection.

2.3  Trade Factors Affecting Country Decisions to Join the UNEF Protocol

    The above sections examined potential impacts of the protocol's trade
control provisions on signatory and non-signatory countries.  But, which
countries will decide to join or abstain from joining and why?  Many countries
will choose whether or not to join the protocol primarily on the basis of
environmental merit.  Here, we examine the relative attractiveness of joining
the protocol in response to its trade provisions.  Exhibit K-2 provides a list
of countries that participated in the Montreal Protocol negotiations.  Exhibit
K-2 also provides a list of those countries that have already signed the
protocol.  Many of the countries that participated were not authorized by their
governments to sign at Montreal but have indicated that they are likely to sign.
We discuss, in turn, the attractiveness of joining the protocol for:  industrial
countries;  newly industrialized countries; least developed countries; and large
developing countries.

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                                 K-ll
                              EXHIBIT K-2

       COUNTRY PARTICIPANTS IN THE DNEP NEGOTIATIONS IN MONTREAL
              AND SIGNATORIES TO THE PROTOCOL TO  PROTECT
                          STRATOSPHERIC OZONE

         Industrial Co'*"tries:

         Signed —

         Australia                      Luxembourg
         Belgium                        Netherlands
         Byelorussian Soviet            New Zealand
          Socialist Republic            Norway
         Canada                         Portugal
         Denmark                        Spain
         EEC Countries                  Sweden
         Finland                        Switzerland
         France                         Ukrainian Soviet
         Germany                         Socialist Republic
         Greece                         Union of Soviet Socialist
         Israel                          Republics  •
         Italy                          United Kingdom
         Japan                          United States

         Participating but not yet signed a --

         Austria

         Newly Industrialized Countries:

         Signed --

         Argentina                      Venezuela
         Mexico

         Participating, but not yet signed a --

         Brazil                         Malaysia
         Colombia                       Nigeria
         Korea,  Republic of
Many countries that have not yet signed the protocol were not authorized
to do so in Montreal and are currently considering participation in the
protocol.

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                                  K-12
                              EXHIBIT K-2
                              (continued)

       COUNTRY PARTICIPANTS IN THE UNEP NEGOTIATIONS IN MONTREAL
              AND SIGNATORIES TO THE PROTOCOL TO PROTECT
                          STRATOSPHERIC OZONE
         Large Developing Countries:

         Signed --

         Indonesia

         Participating but not yet signed a --

         China
         India

         Least Developed Countries:

         Signed --

         Chile                          Morocco
         Egypt                          Panama
         Ghana                          Senegal
         Kenya                          Togo
         Maldives
         Participating but not yet signed
a __
         Algeria                        Kuwait
         Burkina Faso                   Mauritius
         Congo                          Peru
         Costa Rica                     Philippines
         Dominican Republic             Thailand
         Democratic Yemen               Tunisia
         Ecuador                        Uganda

         COMECON Countries:

         Participating but not yet signed a --

         Czechoslovakia
         Hungary
         Poland
Many countries that have not yet signed the protocol were not authorized
to do so in Montreal and are currently considering participation in the
protocol.

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                                     K-13
    2.3.1  INDUSTRIAL COUNTRIES

    The industrial countries are the largest producers and consumers of CFC and
halon bulk chemicals and CFC and halon end-user products.  Host of these
countries are self sufficient net exporters of these bulk chemicals.  Those that
are not self-sufficient are supplied by other industrial countries.^  The
countries are responsible for the majority of world trade in CFC and halon
related products.  As such, their participation in the UNEP protocol is
particularly important.  Few industrial countries could afford to not join
because important CFC-related products would be banned by other industrial
countries, as stipulated by the protocol's trade control provisions.^  At the
same time, these countries can afford the transition costs of developing and
adopting alternative chemicals and industrial processes not reliant on CFCs or
halons.  Companies in these countries are already conducting research and
development efforts, and many have patents on potential substitute chemicals and
technologies.

    As shown in Exhibit K-2, twenty-five industrial countries were official
participants in the Montreal negotiations.  Of these, twenty-four countries
either individually signed the protocol or became party -to the agreement due to
their membership in the European Economic Community (EEC), which signed the
protocol as regional representative of its twelve member states.  Austria, which
has not yet signed the protocol, is expected to join the agreement.
Czechoslovakia, Hungary, and Poland also participated and are expected to sign
the protocol.

    2.3.2  NEWLY INDUSTRIALIZED COUNTRIES (NIGS)

    The newly industrialized countries (NICs) are designated as such due to the
significant and growing role of manufactured goods produced in their economies,
especially industrial products.  They are also the largest producers and users
of CFCs and CFC end-user products among the developing countries.  CFC end-user
products manufactured in the NICs include:  automobiles, electronics,
refrigeration, and air conditioning equipment.  NICs that currently produce bulk
CFCs include:  Brazil, Korea, Taiwan, Mexico, Venezuela and Argentina.^

    Although complete CFC export data are unavailable, it appears that
production of bulk CFCs in the NICs is mainly for domestic consumption rather
than for export.17  Therefore, the impact of an import ban by signatories of
bulk CFCs produced in non-signatory NICs would have a limited negative impact on
     ^ See Attachment K-3 which illustrates the import level and country-origin
of CFC-11, CFC-12 and CFC-22 of selected industrial countries.

     " See Attachment K-4 on the importance of the U.S. market for CFC-related
exports by other industrial countries.

        CFC production in most of these countries is conducted by subsidiaries
of transnational corporations from the United States and other industrial countries.

     17 Attachment K-2 illustrates the various levels of production/use of CFC-
11 and CFC-12 in selected developing and industrial countries.

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                                      K-14
the export earnings of these countries or on their respective chemical
industries.

    The NICs, however, have become significant producers and exporters of
manufactured goods containing CFCs, including:  motor vehicles, air
conditioners, and refrigerators.^  Although production of these goods is partly
for domestic markets, these countries are increasing their exports to
industrialized country markets.  The possibility of  restrictions on the export
of these products by the NICs creates a strong incentive for them to join the
protocol in order to maintain exports and export earnings.  For many of the
NICs, potential restrictions on auto exports offer the strongest incentive to
join.  For example, Brazil and Korea would be immediately and strongly affected.
Taiwan, which currently plans to expand auto exports to the United States and
other industrialized countries, would be increasingly affected if it chooses not
to comply with the protocol.^

    The NICs are also -the largest producers among developing countries of
products manufactured with but not containing CFCs, notably electronics.  Should
the protocol's trade control provisions be extended to such products, their
domestic electronics industries and export earnings would be severely affected.
NICs that would have the most to gain by joining the protocol include:  Korea,
Taiwan, Singapore, and Malaysia.  For example, electronics exports by these
countries to the U.S. account for between 12 percent and 20 percent of all
exports to the U.S.20

    The threat of losing access to important overseas markets for major export
products provides the greatest incentive for the NICs to join the UNEP protocol.
Membership in the protocol would allow signatory NICs continued access to
industrial country markets for their CFC end-user products.  Provision of an LDC
Grace Period from control measures to freeze and reduce CFC use for those LDCs
that join the protocol under article 5 ("Special Situation of Developing
Countries") would increase the relative attractiveness of joining for the NICs
by reducing the near-term adjustment costs.  Most significantly, such a Grace
Period would allow growth in CFC use for ten years, provided per capita
consumption of CFCs and halons does not rise above 0.3 kilograms.  During this
period, efforts to develop new technologies that do not require the use of CFCs
will proceed in the industrial countries.  There are provisions in the protocol
     1 R
     i0 Attachment K-4 illustrates the importance of the U.S. market for
particular exports of CFC end-user products from selected developing and
industrial countries.

     *-* Because Taiwan is no longer a member of the United Nations, it cannot
become party to the protocol.  It is likely, however, that Taiwan will abide by
the protocol's control measures under article 2 and data reporting provisions in
article 7.  Full compliance with these provisions would enable Taiwan to avoid
the protocol's trade controls, as stipulated in article 4, paragraph 8.

     20 See Attachment K-4, Exhibit 4.

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                                      K-15
to facilitate transfers of these technologies to the developing countries and
provide technical assistance.

    It is important to note that the Grace Period from protocol control measures
afforded developing countries that join would not enable them to become a new
source of supply for non-signatories of controlled substances.  The protocol
explicitly prohibits developing country signatories from using their expanded
use allowance for these purposes under paragraph 2, article 4 on trade control
measures.

    Although eight NICs participated in the Montreal negotiations, only three
have thus far joined; Argentina, Mexico, and Venezuela.  This is partly because
many of these representatives were not authorized by their governments to sign
at Montreal.  (See Exhibit K-2).

    How may other NICs will respond to the threat of losing market access to the
industrial signatory countries for their exports of CFC end-user products?
Recent experiences of Korea and Taiwan, for example, suggest that these
countries will join or comply with the protocol, though perhaps not immediately.
These two countries have made continued efforts to retain market access to the
United States by addressing American trade-related concerns.  For example, in
response to Congressional criticism of their respective trade surpluses with the
.U.S., both Korea and Taiwan took steps to reduce or freeze exports to the U.S.
and expand their purchases of U.S. products.  The U.S. represents the major
export market for these countries, and'continued market access, even at frozen
or reduced levels, is an important priority.  The potential impact of a protocol
ban on imports of CFC-related products from non-signatory countries should
elicit a decision by these countries to join or comply with the protocol.

    Brazil's economic incentive to join the protocol in response to trade
restrictions is not as strong as that of Korea and Taiwan.  Most significantly,
Brazil has options the other two countries do not have.  Brazil has a large
domestic market which is capable of generating economic growth.22  Qn the other
hand, recent political developments in Brazil have intensified the country's
economic focus on the international arena, which requires continued access to
industrial country markets for such products as the Volkswagen Fox, currently
being marketed in the U.S.  Of course, Brazil may join primarily on a basis of
environmental protection.

    In summary,  the Montreal protocol's trade provisions provide very strong
incentives for the NICs to join the protocol if they are to continue exports
which they have successfully increased in recent years.  The value to these
countries of potentially lost export earnings is high.  Of all the developing
countries, the NICs have the greatest interest in retaining access to the
markets of the industrialized countries.  As a result, it is likely that they
     21 See Attachment K-l, Article 5, paragraphs 2 and 3, and Article 10,
Montreal Protocol on Substances That Deplete the Ozone Layer. UNEP, 1987.

     22 Brazil's domestic market has exhibited the ability to absorb production
slated for export.  Built-up consumer demand has shown itself capable of
effectively capturing sales of motor vehicles and other products originally made
for export.

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                                      K-16
will join the protocol to avoid strong trade restrictions.  The protocol's
technology transfer, and technical and financial assistance provisions provide
important additional incentives for these countries to join, or at least comply
with the protocol.

    2.3.3  LEAST DEVELOPED COUNTRIES

    The least developed countries are the smallest users of CFCs among the
developing countries.  In general, these countries do not have domestic
production capacity for CFC chemicals and do not produce CFC-related products.
For these countries, CFC use is limited to imports of CFCs contained in consumer
products or used to manufacture products.

    The potential effects of the UNEP protocol's trade control provisions are
less important to the least developed-countries than other developing countries.
Because they have few exports of CFC-related products, the protocol's trade
restrictions are of little concern to these countries.  They also should
experience very limited balance of payments effects due to potential CFC price
increases (induced by global reductions in CFC production) that might occur.

    For most least developed countries there is little immediate economic
incentive as a result of trade provisions to become protocol signatories.  For
most of the least developed countries, the greater incentive to join the UNEP
protocol may be largely environmental and political.  For example, their
participation in the protocol may contribute to a favorable international image.
Support for the agreement may result in strengthened relations between
individual developing and industrial countries.  The costs of membership appear
to be minimal.  Reflective of these factors, twenty-three least developed
countries were official participants in the Montreal negotiations, of which nine
signed the final protocol.  (See Exhibit K-2).  As mentioned previously, some of
these representatives were not authorized to sign at Montreal.

    A few of the least developed countries, such as Egypt, have relatively high
per capita CFC consumption levels.  (See Attachment K-2).  Others have small but
growing'CFC end-user industries, primarily assembly of air conditioners,
refrigerators, and electronics products.   Thailand, for example, is a net
exporter of air conditioners, while several least developed countries, such as
those in the Caribbean Basin, are establishing electronics assembly industries
for export.   For these countries, membership in the protocol may be important to
continued export expansion.

    2.3.4  LARGE DEVELOPING COUNTRIES

    The developing countries with large populations are significant users of
CFCs.   India, Indonesia,  and the Peoples Republic of China all use large amounts
of CFC-11 and CFC-12.  China and India are also producers of CFCs.  Total use of
CFCs in these countries is large, but per capita use is much smaller than in the
industrial countries and slightly smaller than in the NICs.  (See Attachment
K-2.)

    CFC use for industrial applications in the large developing countries is
similar to that in the NICs.  This is particularly true for India which has an
impressive domestic electronics industry.  China is also attempting to expand
its electronics industry.   Both countries also produce other CFC-related

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                                      K-17
products such as automobiles, refrigerators and air conditioners.  Production of
most industrial goods by these countries, including CFC end-user products, is
for the domestic market.  However, in recent years, the large developing
countries have attempted to increase their respective manufactured exports.

    Protocol trade controls banning imports of CFC-related products from
non-signatories could impair the continued near-term growth of CFC end-user
industries in the large developing countries.  Although currently earned foreign
exchange could be lost, restricting CFC end-user product exports would have its
greatest effect on future industry growth, assuming current trends continue.
The importance of CFC products 4-s particularly strong for the electronics and
automobile industries, which develop faster under export-led growth.

    The attractiveness of joining the protocol for the large developing
countries such as the Peoples Republic of China and India is greatly dependent
on whether these countries continue to implement development strategies based on
export-led growth of manufactured goods.  Both countries are attempting to
further develop domestic production capabilities in CFC end-user industries such
as motor vehicles and electronics.  Expansion of these industries would require
continued access to the markets of industrial countries.  As in the case of the
NICs, participation in the UNEP protocol may be a key to the continued export
growth of such industries.  The developing nation provision of the protocol that
allows continued growth of CFC use could benefit the current development
strategies of these countries, thus increasing their incentive to join.

2.4  Conclusion

    This paper presents qualitative estimates of the protocol's effects with
respect to prices of CFCs and CFC end-user products, trade, employment, consumer
welfare, and the incentive to develop and adopt non-CFC based technologies.

    The trade-related incentive for countries to join the UNEP protocol to
reduce global emissions of CFCs mostly depends on their level of industrial
development and the relative importance of manufactured exports of CFC end-user
products, in addition to their desire to protect the global environment.  Those
countries with export-led development strategies and large existing or potential
levels of CFC product exports will probably join the protocol.  Countries in
which CFCs and CFC-related products play a small or insignificant economic role,
will not have substantial incentive to join as a result of the trade control
provisions, but may join for environmental or political reasons.

    The major industrial countries are all expected to join the protocol.  Most
have already signed and have the most at stake in the protocol's final
configuration,  as the world's largest producers and consumers of CFCs and
CFC-related products.  .For signatory countries, the effect of an import ban on
CFC bulk chemicals from non-signatories is expected to be small.  This is
because imports from non-signatories account for only a minor share of CFC
consumption in those countries which have joined or are expected to join the
protocol.  An import ban of products containing CFCs from non-signatories would
have minor effects on prices in signatory countries, but employment and profits
of CFC industries in the signatory countries could benefit.  An import ban of
products manufactured with but not containing CFCs from non-signatories would be
expected to have the greatest effects of all, because potential non-signatories
are major suppliers of electronics products.  However,  it has not yet been

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                                      K-18


determined that such products made with but not containing controlled chemicals
will be subject to trade controls.

    The principal economic incentive for the NICs to join the protocol is the
trade control provisions which may ban imports of CFC-related products from
non-signatory countries.  The threat of losing market access for important
products should increase the probability that most of these countries will join,
or at least comply with the protocol.  The decision to join by the large
developing countries will be influenced by the same consideration, alth'ough
these countries do have the option of inward-looking development policies based
on their large internal markets.

    An import ban on non-signatory products containing CFC and halons or
manufactured with CFCs would have a far more substantial effect than
restrictions on bulk chemical trade.  The prospective loss of their major export
markets for products such as automobiles and electronics would provide a strong
incentive for producing countries to join the protocol and/or adopt alternative
technologies.

    The least developed countries are neither producers nor consumers of CFC
chemicals and also are not major producers of CFC end-user products.  These
countries may have the least economic incentive to join as a result of protocol
trade provisions and may be the largest bloc of non-signatory countries.
Without an economic incentive to join the protocol, their decisions will be
largely based on their general desires to contribute to environmental protection
or improve their international image.

    For U.S. CFC and halon producers, an import ban on bulk chemicals should
have an insignificant effect, given the low level of U.S. imports.  An import
ban on products containing or manufactured with CFCs may decrease the already
small level of U.S. CFC producers' exports to non-signatories.  However, this
should have little effect on U.S. industry profits.

    U.S. producers of CFC-related products buy CFCs from U.S. producers.
Therefore, an import ban on bulk chemicals should have minimal impact.  An
import ban on products containing or manufactured with CFCs might slightly
increase prices for the comparable goods from domestic and signatory suppliers.
U.S. production and employment in the relevant industries should be stimulated.
On the other hand, U.S. importers of CFC end-user products from non-signatories
may experience significant losses if many of their key sources of supply are
eliminated.  These are expected, however, to be limited.

3.  ENFORCEMENT AND MONITORING OF PROTOCOL

    This section explains how parties' compliance with the protocol can be
monitored and enforced.  The protocol limits are based on a formula requiring
the calculation of CFC production, imports, exports, and the quantity destroyed.
Restrictions will be placed on trade in CFCs and CFC-related products with
non-parties, as well as halons and halons contained in products.

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                                      K-19
3.1  Monitoring of Compliance With Protocol Limits On Bulk CFCs and Halons

    The monitoring of compliance with protocol limits requires the means to
verify levels of production, imports, and exports of bulk CFCs and halons.
Production of bulk CFCs and halons can be monitored through a variety of
mechanisms.  To verify how much a company is producing, a number of steps could
be taken, such as:

         •    Requiring that companies report production and verify
              these reports through audits of the plant's records.
              This approach does not directly guard against clandestine
              production and shipments.  Presumably, however, such
              shipments could not occur at frequent or high levels
              without creating inconsistencies that would be uncovered
              in an audit;

         •    Requiring that an official inspector be in the plant
              during all hours of operation; and

         •    Requiring that all shipments be officially inspected
              before leaving the plant.

    Monitoring imports and exports of bulk CFCs and halons would be relatively
easy, provided all parties make some minor modifications to their tariff
schedules under the Harmonized System (HS).   The HS is an international trade
reporting schedule to which most major trading nations are converting effective
January 1, 1988.  Under the HS, every participant country will classify its
imports and exports under the same basic nomenclature.^

    EPA has requested that the U.S. International Trade Commission make the
necessary changes in the U.S. tariff schedule under the HS to provide accurate
     " It would be a relatively easy task for each negotiating country to take
the necessary steps during the next few months to ensure that its version of the
HS will include separate classifications for CFC-11, -12, -113, -114 and -115,
as well as for Halons 1211, 1301 and 2402.  Under the HS, a country may use an
unlimited number of digits to designate import/export categories.  However, for
developed countries, the first six digits of any classification must be
standardized (i.e., the same for all countries).  For developing countries, the
first four digits must conform to the international standard.  Each country may
use additional digits to create sub-classifications based on its trade patterns
and interests.

    The four digit HS classification under which imports and exports of both
CDFs and halons would be reported is HS 2903.  The standardized description of
products recorded under HS 2903 is "halogenated derivatives of hydrocarbons."

    The six-digit HS classification for such trade is HS 2903.40, "halogenated
derivatives of acyclic hydrocarbons containing two or more different halogens."
In order to ensure that all trade in CFCs and halons is reported accurately, all
signatory countries would need to create additional classifications at the eight
(or more) digit level to cover CFG- and halon-specific trade.  (In the parlance
of tariff nomenclature, such sub-classifications are called "breakouts.")

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                                      K-20
data on trade in CFCs and halons.  The U.S. delegation has also suggested that
the.other countries negotiating the protocol make similar modifications to their
tariff schedules.24

    A separate arrangement could be made with those countries participating in
the protocol negotiations which are neither members of the GATT or converting to
the HS.  These countries would be required to agree to report on their trade in
CFCs and halons at the same level of specificity as the other signatories to the
protocol.

3.2  Establishing Protocol Limits Based on 1986 Trade

    Once all parties make the necessary tariff schedule changes, statistics on
imports and exports of bulk CFCs and halons should be readily available (both in
terms of shipments and either foreign supplier or market).  Although accurate,
internationally credible production and trade data are not yet available for
1986, the 1986 data can be collected and totals estimated by each party with a
relatively high degree of certainty.  The estimates can be effectively audited
by a comparison of each country's trade data and by reference to other published
sources.

    Each country has the ability to collect accurate data to establish 1986 base
levels.  In the United States the Environmental Protection Agency can require
that producers and traders provide production and trade data.  Such information
would be handled in strict confidence to protect the proprietary rights of the
firms.  Other nations can similarly obtain production and trade data.

    The agency to which the national data are submitted can establish credible
values of each country's production and consumption by investigating and
reconciling differences in imports, exports, and production.  These values can
then be audited against published data.  Published sources include each
country's official trade statistics, plus commercial statistics such as the SRI
Chemical Economics Handbook, and the Chemical Manufacturers Association annual
report.  This will further eliminate discrepancies.

    If necessary, an additional audit can be performed when trade data become
available under the Harmonized System.  It will be possible to "backcast" 1988
data to 1986 levels.  This can be done through regression analysis, where 1988
adjusted production data would be defined as the dependent variable; independent
variables for each country would be identified that reflect the country's
economic activity.  The independent variables must meet two criteria:  first,
data for their 1986 values must be available, and second, they should reflect
not only general economic trends in each country but should be related to CFC
production and use as well.  As an example, GNP per capita, disposable income,
and industrial growth would appear to meet both criteria.  This regression would
yield parameter estimates that could be used in conjunction with 1986 data to
establish 1986 estimates of CFC adjusted production.
        See Attachment K-5 for a copy of the letter from EPA Administrator Lee
Thomas requesting that U.S. International Trade Commission revise the U.S.
tariff schedule.

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                                     K-21
    Based on the official data and various audits,  parties could establish the
final calculated consumption levels for 1986.

3.3  Monitoring Restrictions on Trade in CFC-Related and Halon-Related Products
     with Non-Parties

    The international agreement will impose restrictions on trade in CFC-related
and halon-related products with non-parties.  Standard Customs country-of-origin
reporting requirements (and penalties for false reporting) should ensure that
the United States can accurately identify the source of controlled
substance-related shipments.  Should the United States, in conjunction with
protocol countries or unilaterally, establish any regulations prohibiting
imports of certain CFC-related and halon-related products from specified
countries,  Customs would refuse entry to such goods.

    In the case of products containing CFCs and halons, any restricted products
could appear on a list sent to Customs agents at U.S. ports of entry.  Customs
could then refuse entry to such products.  In the case of products made with but
not containing CFCs, tests would need to be conducted to determine whether CFCs
had been used during manufacture.

    It is possible to detect CFC usage to the degree necessary to
ensure compliance with any regulations.- Some products such as foams or other
materials where the CFCs may be physically or chemically bound may require a
special procedure to release the CFC so it can be collected for analysis.  For
example, samples of a foam material might be heated, cut and/or vacuum treated
to free the chemical content for analysis.

    Although further research and development is required to perfect and
simplify the detection of CFCs, a range of suitable analytical techniques and
instruments already exists.  The most accurate, though correspondingly most
sophisticated and expensive, is the gas chromatograph (GC) using an electron
capture detector.  Such a device requires a stable laboratory environment and
support of dedicated analytical chemists if it is to provide reliable results.
Results are available very rapidly, and quick adaptation or extraction
procedures can be readily developed.  At very busy ports of entry, a GC could be
maintained on-site.

    Another method is to draw the gaseous sample containing CFCs across a
sorbent in a collection tube (e.g., charcoal or tenax in a glass tube) and then
send the collection tube back to a laboratory for analysis on a GC.
Until the results of the test were available,  the shipment would not be allowed
to enter the U.S.  More rapid results and less expensive measurement may be
possible by adapting other specific field techniques, such as colormetric,
thermal or ionization type systems.

    Protocol enforceability through monitoring CFCs and halons contained in, or
CFCs used to manufacture products is dependent on several variables, including:
the desired threshold of detectability (at the percent level versus parts per
billion); the speed required to derive results (instantaneous "read out" from an
instrument versus data from a laboratory); and the technical training and
background of the person collecting and/or analyzing the sample.  Protocol
regulations may provide the market incentives for development of the necessary
instruments.

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                                      K-22
3.4. Possibility of Customs Fraud

    Monitoring of compliance with the protocol limits would be more difficult in
the case of Customs fraud, where traders deliberately disguise either the
contents of the shipment or its origin/destination.  However, the same penalties
that countries currently impose on fraudulent traders could be applied in the
case of CFCs, halons, and related products and would presumably constrain most
illegal trade.

3.5  Should the Protocol Include Verification/Inspection Measures?

    It might be possible to employ a verification/inspection system as an
additional check on the compliance of the parties to the protocol.  This section
analyzes the compliance procedures of other international environmental
agreements and assesses the major issues relating to the inclusion of a
verification/inspection system in the stratospheric ozone protocol.

    International environmental agreements are typically characterized by an
element of trust and the presumption of the parties' good faith implementation
of their obligations.  In most cases, parties regulate and monitor activities
within their jurisdictions to ensure domestic observance of the agreement's
provisions.

    The majority of international environmental agreements determine party
compliance through recordkeeping, reporting, and information-exchange
requirements, rather than independent inspection and verification procedures.
Even many "regulatory" environmental agreements, which mandate specific control
actions, rely upon such requirements to corroborate implementation.

    For example, the Convention on International Trade in Endangered Species of
Wild Fauna and Flora (CITES) protects certain species from commercial
exploitation and extinction through international regulation of trade:  it
monitors compliance through requirements that parties maintain and submit annual
reports on trade in species covered by the Convention.

    The following agreements also include reporting and/or recordkeeping
procedures to verify compliance:  the Convention for the Conservation of
Antarctic Seals; the Convention for the Protection and Development of the Marine
Environment of the Wider Caribbean Region; the S0_ Protocol to the 1979
Convention on Long-Range Transboundary Air Pollution; the Convention on the
Prevention of Marine Pollution by Dumping of Wastes and Other Matter; and the
International Convention for the Regulation of Whaling (this Convention also
requires that inspectors be maintained on certain whaling ships by. the party
having jurisdiction over the vessel).

    In general, reporting procedures have been an effective check on compliance.

    Some multilateral environmental agreements provide for independent
inspections as a means of confirming compliance.  For example, under the
Antarctic Treaty --an agreement restricting the use of Antarctica to peaceful
purposes --a party has the right to designate an observer to inspect any area
of Antarctica, including any ship, aircraft or stations,  installations, or

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                                     K-23
equipment of another party.  The Convention on the Conservation of Antarctic
Marine Living Resources ensures compliance with the agreement's harvesting
standards through a system of observation and inspection of vessels in the area
to which the Convention applies.

    The advisability of a verification/inspection system depends on the
institutional arrangements required, the costs of operating such a system, and
the degree to which the system would be a reliable indicator of compliance.

    There is the possibility for some non-compliance even under a system of
protocol-sanctioned verification/inspection.

    It may be preferable to use in the stratospheric ozone protocol a provision
similar to that of the South Pacific Nuclear Free Zone Treaty, whereby the
parties may appoint a panel of experts to investigate any party suspected of
noncompliance or of falsifying records.  Such investigations could be initiated
by the determination of a Consultative Committee (comprised of representatives
of the parties) that there is sufficient evidence in a complaint that a party is
in violation of its obligations.  The panel of experts would be given full and
free access to all information and places which may be relevant to their
investigation.

3.6  Conclusions

         1.   Official trade statistics should be an accurate monitor
              of trade in CFCs and halons and related products,
              assuming that necessary modifications to party tariff
              schedules are made.

         2.   Products containing CFCs and halons and products made
              with but not containing CFCs can be identified using
              existing technology.   The cost and difficulty of
              detecting CFCs will vary by product.

         3.   As in the case of all other trade, the possibility of
              Customs fraud in CFC and halon trade exists.  The United
              States could impose its most stringent penalties for
              Customs fraud in CFC and halon trade as a further
              disincentive to cheating.

         4.   It may be advisable to employ a system whereby
              substantiated complaints against a party for suspected
              non-compliance would be investigated by a panel of
              experts with full access to all relevant documents and
              facilities.

4.  SUITABILITY OF TRADE MECHANISMS FOR CONTROLLING TRADE IN CFCs, HALONS AND
    RELATED PRODUCTS

    This section identifies trade control mechanisms that are most suitable for
controlling trade in CFCs,  halons,  and related products.

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                                     K-24
    The United States currently employs a variety of mechanisms to control trade
in certain products.  Those most commonly used include:

        1.  Bans on the importation of certain goods.

        2.  Certification/inspection/testing programs,  which set
            standards that a product must meet and require that the
            product be certified as meeting those standards.  The U.S.
            government or a government-approved entity inspects and
            tests the product to confirm that the certification is
            correct.

        3.  Labeling requirements, which also set standards that a
            product must meet.  Products are only tested if there is
            strong evidence that they are not in compliance with the
            standards. •*

        4.  Quotas. which set specific limits on the amount of a good
            from a particular country that can enter the United States.

        5.  Import fees, which raise the tariffs assessed against a
            product.

    Any of these existing trade mechanisms could be used to control trade in
CFCs, halons, and related products.  It is not necessary to design'entirely new
mechanisms for the control of such trade but rather to select and perfect those
mechanisms that are most appropriate for doing so.

    The following sections analyze the strengths and weaknesses of each of these
mechanisms for controlling trade in CFCs, halons, and related products.  Each
mechanism is evaluated with respect to its:

        •   effectiveness in controlling the level of imports;

        •   enforceability;

        •   cost of implementation for the federal government, U.S.
            consumers, and U.S. businesses (whether it puts the latter
            two at a significant disadvantage vis-a-vis their
            international counterparts); and

        •   ability to influence the development of alternative, non-CFC
            based technologies.
     25 There is no set definition for labeling requirements or for certifica-
tion/inspection/testing programs.  As the terms are used in this paper, the
critical distinction between labeling requirements and a certification/inspec-
ction/testing program is that the former require self-certification by
manufacturers or importers and products are only tested under certain
conditions.  The latter require certification by the manufacturer, the
government or a government-approved entity; products are tested regularly for
compliance.

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                                     K-25
    U.S. experience with the trade mechanisms is used to evaluate the measures
with respect to effectiveness, enforceability, and cost.  For the criteria of
technical innovation, where experience provides little guidance, the evaluations
are more speculative.

4.1  Bans26

    Bans are prohibitions on the importation of certain goods.  When trade in an
item is banned, Customs officials do not allow it to enter the United States.
The ban is enforced by Customs officials who make inspections at ports of entry
to the United States.  The effectiveness of the ban depends largely on the ease
of identification.

    Bans have only occasionally been employed by the United States.  One
successful ban currently maintained by the United States is that against imports
of most aerosols containing CFCs.  This measure is a "blanket" ban since it
covers goods from all foreign suppliers.  Together with regulations against U.S.
production of similar products, it has eliminated aerosols containing CFCs in
the United States.

    The U.S. also employs "partial" bans which are directed against imports from
specific countries.  For example, under the Cuban Assets Control Regulation, the
United States bans imports from Cuba, and also bans imports of products derived
in whole or in part from Cuban products.

    Bans have been very effective in instances in which the United States wished
to eliminate completely certain products from U.S. commerce.  Blanket bans are
usually well enforced.  Partial bans are more difficult to enforce because
Customs must determine the country of origin.

    The cost of implementing a CFC-related and/or halon-related ban would be
relatively low for the federal government.  Customs officials would add the
relevant CFC-related and halon-related products to the list of items that are
not permitted entry.  In the case of a partial ban, Customs agents would be
required to determine which shipments could and could not enter the country.

    The costs of CFC and halon product bans to customers would tend to be low
provided the goods were sold in competitive markets with close substitutes.
Most CFC-related and halon-related goods have close substitutes with supply from
U.S. manufacturers and other countries likely to join the protocol.  However, in
the case of electronics and, to a lesser extent, automobiles, a ban could cause
price increases or limited product availability.  (In the case of automobiles,
this would apply only to selected model imports.)  For these products where
labor can be a large part of the cost of the good, a ban in effect against
countries that were low cost suppliers to the U.S. market could cause price
increases.

    The influence of a ban on the development of alternative technology will
depend on the importance of the U.S. market to the foreign manufacturers'
     nr
     i0 The discussion in this section is limited to bans on products that would
enter the mainstream of U.S.  commerce.  This section does not discuss bans on
illicit goods such as narcotics that are traded in the black market.

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                                      K-26
overall business.  If the U.S. market is important to foreign manufacturers, it
is likely that alternative technologies would be developed or adopted to regain
market access for companies in countries that do not initially joint the
protocol.

4.2  Certification/Inspection/Testing

    Under an import certification system, documents confirming that the product
meets specified standards must be presented to Customs before the good is
allowed to enter U.S. commerce.  Most certification programs require both
foreign and domestic manufacturers to comply with the same,standards.

    A variety of certification systems may be used.  The three most common are:

         •    Self-certification.  The manufacturer or importer
              certifies that the product meets specified standards.

         •    Laboratory certification.  A testing laboratory designs
              and conducts tests to establish whether products meet
              specified standards.  The manufacturer or importer must
              supply documentation from the laboratory that certifies
              that the products met all relevant tests.

         •    Government certification.  A U.S. or foreign government
              agency certifies that products meet established
              standards.

    Laboratory and government certification is generally achieved through
inspection and/or testing which may be done at the point of manufacture, at the
port of entry, or at an accredited laboratory.  Laboratory and government
certification generally have combined three elements into a single program:
certification, inspection, and testing.

    The United States maintains large-scale certification/inspection/testing
programs, primarily to ensure compliance with health and safety standards on
such imports as foods and drugs.  Examples include the meat and poultry
inspection programs conducted by the U.S. Department of Agriculture (USDA) and
the Food and Drug Administration's (FDA) program for testing foods for levels of
pesticide residues.  Under the USDA programs, all imports are tested; under the
FDA program, only about one percent of imports are tested.  Foreign and domestic
manufacturers must comply with the same standards.

    Certification/inspection/testing measures have been highly effective at
ensuring specific product standards.  The enforceability of certification/
inspection/testing programs appears to be high when the following conditions are
met:

         •    compliance with the relevant standards can be tested;

         •    the penalties for non-compliance are stringent; and

         •    inspection is fully staffed.

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                                      K-27
    These conditions can be met in the case of CFC-related and halon-related
products.  Identification of prohibited goods is possible, as is discussed in
Section 3.  Testing procedures may be conducted on either a comprehensive or
random sampling basis/  Stringent penalties for violations can be incorporated
into the CFC-related and halon-related regulations.  Funding for a U.S.
inspection effort could be accomplished through the budgetary process.

    The effectiveness of a certification/inspection/testing mechanism for
promoting alternative technologies will depend in part on the attractiveness of
the U.S. market to the foreign manufacturer. . In tfiis respect, the USDA meat
inspection program is evidence of the substantial efforts foreign producers will
make to serve U.S. markets.  For many foreign producers, access to the U.S.
market is important enough for them to comply with U.S. health and safety
regulations and to allow U.S. inspectors to conduct on-site reviews of their
plants.  The importance of the U.S. market to many offshore producers of
CFC-related products such as electronic goods and automobiles may induce them to
both comply with the regulations and develop or adopt alternative technologies.

4.3  Labeling Requirements

    Many of the U.S. certification programs have limited inspection/testing
components.  In such instances, manufacturers are required to label their
products to indicate that they are in compliance with the requisite standards.
In general, neither imported nor domestically-produced goods are tested under
these programs unless consumer complaints or accidents indicate that products
might not be in compliance with the relevant standards.

    The United States maintains numerous programs with labeling requirements.
Many are under the jurisdiction of the Consumer Product Safety Commission
(CPSC), including products regulated under the Consumer Product Safety Act, the
Flammable Fabrics Act, the Poison Prevention Act and the Federal Hazardous
Substances Act.

    The effectiveness of labeling programs appears to be high despite limited
monitoring to ensure compliance.  No data exist to compare levels of compliance
under a labeling system with that under a certification/inspection/ testing
program.  It is therefore impossible to determine whether violations occur more
frequently under one system or the other.  However, non-compliance is probably
higher under a certification/inspection/testing program.

    A system of labeling requirements relies heavily on good-faith efforts on
the part of manufacturers, self-interest on the part of retailers (who do not
want to gain a reputation for selling unsafe products), and pressure by consumer
groups on companies to comply with the regulations.  In the case of CFC-related
products, it is likely that citizen groups and competing businesses would serve
a key watchdog function in monitoring compliance.

    The cost of a labeling program to the federal government is low.  If
compliance with the standards is high, the cost to consumers and businesses
should be the same as under a certification/inspection/testing program with the
same standards, and the incentives to develop alternate technologies should also
be similar.

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                                      K-28
 4.4 Quotas

    Under a quota system, the United States determines  (either through
 negotiation or through a unilateral decision) the amount of imports of a
 particular product from a specific country that it will allow to enter the
 country.  At all ports of entry Customs officials monitor U.S. imports of that
 product and, when the quota level has been reached, refuse to allow additional
 shipments to enter the country.

    The United States makes extensive use of quotas to limit imports to pre-set
 levels, particularly in the area of textiles and apparel.  Quotas have proven to
 be  a very effective and enforceable means of holding U.S. imports to a specified
 level.

    The cost of a system of quotas is high to the federal government and to
 consumers.  The U.S. government must devote considerable resources to monitoring
 fill rates and checking regulated shipments at the ports of entry.  In addition,
 the determination of appropriate quota levels and the subsequent negotiation of
 such levels with trading partners requires considerable administrative effort.
 Consumers must pay higher prices as a result of the quotas.

    On the other hand, quotas also benefit those U.S. businesses manufacturing
 the same products that are being regulated.  For example, the U.S. textile and
 apparel industry has benefited greatly from the U.S. quota program.

    A quota system's effect on the development of non-CFC-based technologies
 will depend on the quota levels established and the availability of alternative
 markets to the manufacturer.  The incentive would be greater if the quota level
 were low enough to cause the manufacturer difficulty.  A key issue is whether
 the quota that properly protects the ozone layer would act as an incentive to
 technological innovation.

 4.5  Import Fees (Higher Tariffs)

    When goods enter the United States, Customs assesses a duty or tariff on the
 product, which the importer must pay.  Duties range from nothing to levels as
high as 50 percent of the value of the good.   In general, U.S. tariffs are
between three and seven percent of the value of the good.  Import fees are, in
 effect, an increase in the tariffs assessed against certain products.

    The United States occasionally uses higher tariffs as a policy tool.
 Increased tariffs have been used primarily as a means of protecting a given U.S.
 industry from import competition from subsidized products.  For example,  the
United States recently raised the duty on wood shingles to 35 percent ad valorem
 in order to provide relief to the U.S.  industry from subsidized Canadian
 imports.

    Higher tariffs are readily enforceable (Customs merely assesses higher
 duties against imports at the port of entry).  In general, the costs to the
 federal government of imposing increased import fees are negligible.  Only
minor administrative measures are required to establish the new tariff rate.
 Import fees would result in higher costs for U.S.  consumers and U.S. importers
 that rely on the imports, if the products were essential and there were no

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                                      K-29


cost-competitive alternative sources of supply.   As indicated earlier, import
fees do provide some relief for the U.S. industry producing comparable goods.

    In the case of CFG and halon regulation, the objective of import fees would
not be to protect the relevant U.S. industries but rather to achieve the
environmental goal of reduced usage of CFCs and halons.  The import fees would
be imposed to act as an incentive for countries to join the protocol and also as
a method of discouraging use of imported CFC and halon products.  In effect,
import fees would be used to induce behavioral changes on the part of consumers
and manufacturers, creating an incentive to shift away from products that use
CFCs or halons.

    The price elasticity of restricted products and the level of the higher
tariff will determine the effectiveness of the import fee in promoting the
environmental objective and encouraging the development and adoption of
alternative technologies.

4.6  Conclusions

    Exhibit K-3 summarizes the performance of each trade control mechanism with
respect to the key criteria of effectiveness, enforceability, expense, and
ability to induce alternative technological development.  Each mechanism has
particular strengths and weaknesses and any could be used to control trade in
CFCs, halons, and related items.  This evaluation suggests two measures --
certification/testing/inspection and import fees -- are best suited to the task.

    Certification/inspection/testing offers the flexibility to set standards
appropriate to each product and to ensure compliance with those standards.  It
would appear to be highly effective in promoting the environmental objectives of
CFC and halon controls.  The major disadvantage of such a system is its
potential expense to the federal government.

    Import fees could also be an effective tool if appropriate tariffs for each
product are calculated.  While fees would not allow the flexibility of setting
standards for individual products, they would be a more market-oriented
mechanism.  Fees would impose a set cost on imports of particular products,
causing importers and manufacturers to adapt their procedures to the new market
circumstances.

    Of the other three mechanisms, labeling would appear to offer a potential
alternative to certification/inspection/testing.  The same standards can be
imposed under both systems, but labeling would be far less expensive to
implement.  The chief disadvantage is the possibility of cheating under a
labeling program.  Because of this, the United States may want to consider
labeling only in instances where it feels the incentives to circumvent
regulations are low and where the opportunities for concerned groups to act as
watchdogs and monitor compliance are strong.

    Quotas would be more difficult to implement for CFC-related goods than the
other mechanisms, given the" diversity of products and foreign suppliers.  The
establishment of quotas would require calculation of appropriate import levels
for each CFC-related good from each potential supplier.

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                                                     EXHIBIT K-3

                          EVALUATION OF  TRADE  CONTROL MECHANISMS  FOR  CFC-RELATEO PRODUCTS
         Cert If teat Ion/
          Inspection/
                               Bans
                                            Test Ing
                                                               LabelIna
                                                                                   Quotaa
                                                                                                    Import Fees

Effect Ivenass

Enforceabl 1 1 ty

Eipense:
U.S. Government

High
1 •'
High Medium
£/ 1 1
Medium-High


High | Low
1
1
Lou . 1 High . I LOM
U.S. Consumers j Lou d/
U S Importers
Incent I ve to
Develop Alternative
Technology
High
High

Low d/ 1 LO- <"
Med 1 urn
High

1
1
1
Comments









Useful only in (Expensive to
special cases.
implement and
Particularly (maintain, but
effective If al 1 (provides most
protocol members (direct compll-
act together jance verifica-
Low
Medium




High

High


Low
Low «•'
High
Medium



1
Most effective
where likelihood
of cheating Is
low or watchdog
capacity Is high.

tion, j

1
In cases with
large numbers of
Importers and high
volume of Imports.
Quotas are dif-
ficult to estab-
l 1st .

fi'
High

High


Low
Low «"
High
High




Strong If suffi-
cient tariffs are
Imposed.





                                                                                                                                    to
                                                                                                                                    o
a/  This depends  on  the potential consumer response and assumes a low.level of successful  evasion.

b/  This assume*  that appropriate tariff levels are established.

c/  This depends  on  whether a ban Is partial or blanket.

d/  Costs to consumers would be high only if goods were sold In non-competitive markets without  close.
    cost-competitive substitutes available from protocol members.  Most CFC products have  close  substitutes in
    competitive markets,  thus low consumer costs are eipected.

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                                     K-31
   •Finally,  bans would appear to be best suited for use in isolated instances,
such as:   1)  to continue and perhaps strengthen the existing restrictions on
aerosols with CFCs,  where a blanket rather than partial ban can be imposed;  or
2) to implement a program in concert with other protocol nations to eliminate
trade in certain CFC-related products with non-parties.

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United Nations  Environment Progri
                                                                       DNEP
                            MONTREAL PROTOCOL ON




                   SUBSTANCES  THAT DEPLETE THE OZONE LAYER
                                 PIRAL ACT
                                    1987

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                                   FINAL ACT
 1.   The Conference  of  Plenipotentiaries on the Protocol on Chlorofluorocarbons
 to the Vienna  Convention  for the Protection of the Ozone Layer was convened  by
 the Executive  Director  of  the United Nations Environment Programme (UNEP)
 pursuant to  decision 13/18 adopted by the Governing Council of UNEP on 23  May
 1985.

 2.   The Conference  met at the Headquarters of the International Civil Aviation
 Organization,  Montreal, with the kind support of the Government of Canada, from
 14 to  16 September 1987.

 3.  All States were invited to participate in the Conference.  The following
 States  accepted the  invitation and participated in the Conference:

     Algeria,  Argentina, Australia, Austria, Belgium, Brazil, Burkina Faso,
     Byelorussian Soviet  Socialist Republic, Canada, Chile, China, Colombia,
     Congo, Costa Rica, Czechoslovakia, Denmark, Democratic Yemen, Egypt,
     Finland,  France, Germany, Federal Republic of, Ghana, Greece, Indonesia,
     Israel, Italy,  Japan, Kenya, Korea, Republic of, Luxembourg, Malaysia,
     Mauritius, Mexico, Morocco, Netherlands, New Zealand, Nigeria, Norway,
     Panama, Peru, Philippines, Portugal, Senegal, Spain,  Sweden, Switzerland,
     Thailand, Togo, Tunisia, Uganda, Ukrainian Soviet  Socialist  Republic,
     Union of  Soviet Socialist Republics, United Kingdom of Great Britain and
     Northern  Ireland, United States of Ame'rica, Venezuela.

4.   The European Economic Community also participated.

5.   Observers from  the following States attended the proceedings of  the
Conference:

     Dominican Republic, Ecuador, Hungary, India, Kuwait,  Poland.

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            .


      Manufacturers Association, Natural Resources Defense Council

        "
                                      by "'' M°8tafa *'  Tolb'' the
                               -EErS : "
                                          .-General of  the Conference  and
                                       Executive Secretary.

                   unanimously elected Ambassador W. Lang  (Austria)  as  its


10.  The Conference also  elected the following officers:

     Vice-Presidents:     Ambassador E. Hawas (ERypt)
                        Dr. V. Zakharov (Union of Soviet  Socialist  Republics)

     Rapporteur:         Mr. C.R.  Roque (Philippines)

11.   The Conference adopted the following agenda:

     1.    Opening  of the Conference.

     2.    Organizational matters:

          (a)  Adoption of the rules of  procedures;
          (b)  Election of the President;
          (c)  Election of Vice-Presidents and Rapporteur;
          (d)  Adoption of the agenda;
          (e)  Appointment of  the members of the Credentials Committee;
          ir)  Appointment of  the members of the Drafting Committee-
          (g)  Organization  of the work of the Conference.

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                                -  3 -
      3.    Consideration of the draft  Protocol to the Vienna Convention  for  the
           Protection of the Ozone Layer.

      4.    Report of the Credentials Committee.

      5.    Adoption of the Protocol to the  Vienna Convention for the Protection
           of the Ozone Layer.

     6.    Adoption of the Final Act of  the Conference.

     7.    Signature of final instruments.

     8.    Closure of the Conference.

12.  The Conference adopted as  its rules of procedure document UNEP/IG.79/2
proposed by the secretariat.

13.  In conformity with the rules  of procedure, the Conference established the
following Committees:

     Committee  of  the Whole:

     Chairman:            The President of  the Conference

     General Committee;

     Chairman:            The President of  the Conference

     Member8:             The Vice-Presidents of the Conference, the
                         Rapporteur and the Chairman of the Drafting Committee

     Drafting Committee;

    Chairman:            Mr. Jon  J. Allen  (Canada)

    Members:             Argentina
                         Australia
                         France
                         Japan
                         United Kingdom
                         United State*

    Credentials Committee;

    Chairoan:             Aabassador Jose M. Buatani (Brazil)

    Members:              Finland
                         Germany, Federal  Republic of
                         Indonesia
                         Kenya
                         Mexico
                         Norway

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                                     " te baSi" f" the "'^rations of the


            Seventh  Revised Draft Protocol on [Chlorof luorocarbons ]  [and Other
            Ozone Depleting Substances], UNEP/IG.93/3 and Rev.  1;

            Reports  of the Ad Hoc Working Group of Legal  and  Technical  Experts
            for the  Elaboration of a Protocol on Chlorof luorocarbons  to the
            Vienna Convention for the Protectipn of the Ozone Laver  (Vienna
            Group),  UNEP/VG.151/L.4, UNEP/WG. 167/2 and UNEP/WG.l 72/2 .

 15.  In addition, the Conference had before it a number  of other  documents that
 were uade available to it by the Secretariat of UNEP.


 !L l^ Conf"en" approved the recommendation of its Credentials  Committee
 ha  the credentials of the representatives of the participating  States as
 listed  in paragraph 3 should be recognized as being in order.

17.  On the basis of the deliberations  of the Committee  of the Whole,  the
tha t        °" ^ September 1987,  adopted the Montreal Protocol on  Substance.
that
             the Ozone Layer.  The Protocol, which is appended to this Final
Act  will be open for signature at the Ministry for External Affairs of Canada
in uttawa irom
17 September 1987 to 16 January 1988 and at the United Nations Headquarters in
New York from 17 January 1988 to 15 September 1988.

18.  The Conference also adopted the following resolutions which are appended
to this Final Act:

     I.    Resolution on the Montreal Protocol.

     ?.    Resolution on the exchange of technical information.

     3.     Resolution on the reporting of data.

     4.    Tribute  to the Government  of Canada.

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                                   -  5  -
 IN WITNESS WHEREOF the representatives have signed this Final .Act.
and S,.ni.h l.ngu.,«, «ch  l.ngu.,,
                                                                    c   n,

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                      1.   RESOLUTION OH THE MONTREAL PROTOCOL
  The  Conference,
  Having adopted the Montreal Protocol  on  Substances that Deplete the Ozone
  Layer,                                                             «*UUB

                                   protoc°l

           5h« JieDM Convention for the  Protection of the Ozone Uyer, adopted
 on 22 March 1985,

 Bearing in mind the Resolution  of  the  Conference of Plenipotentiaries on the
 Protection of the  Ozone Layer adopted  on  the  same day which urged in the sixth
 operative paragraph "all States and  regional  economic integration organiza-
 tions,  pending entry into force of a protocol,  to control their emissions of
 CFCs,  inter alia in aerosols, by any means  at their disposal, including
 controls on production  or use,  to  the  maximum extent practicable",

 1.    Calls upon all States and  regional economic integration organizations that
 have  not yet done  so to implement  the  sixth paragraph, bearing in mind the
 special situation  of • the developing  countries;

 2.   Appeals to all States to become Parties  to the Vienna Convention for the
 Protection of  the  Ozone Layer;

 3.   Urges all  States and  regional economic integration organizations,
 including  those that have  not participated  in this Conference, to sign and
 become  Parties  to  the Montreal  Protocol on  Substances that Deplete  the Ozone
 Layer;

 4.   Requests the  Executive Director of the United Nations Environment
 Programme  to forward this  Resolution to the Secretary General of  the United
 Nations  and  to  circulate  it to  oil States and regional economic  integration
organizations.

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             2.   RESOLUTION OH THE EXCHANGE OP TECHNICAL  INFORMATION
 The Conference,

 Having adopted the Montreal  Protocol on Substances that Deplete the Ozone
 Layer,

 Realizing the importance  of  reducing as quickly as possible the emissions of
 these substances,

 Recognizing  the  need  for  an  early  exchange of  information on technologies and
 strategies to achieve this,

 1.    Requests the  Executive  Director of the United Nations Environment
 Programme (UNEP),  pending the  first meeting of the Parties, to make appropriate
 arrangements  to  facilitate the exchange of information on technology referred
 to  in Articles 9 and  10 of the Protocol;

 2.    Appeals  to  interested States  and regional economic  integration
 organizations to sponsor,  at the earliest opportunity, in cooperation with
 UNEP,  a workshop with the aim  of:

      (a)   exchanging information  on technologies and administrative strategies
           for reducing emissions  of the substances  listed  in Annex A to  the
           Protocol and for Developing alternative!, taking  into  account
           paragraph  2 of  Annex II to the Vienna Convention  for the Protection
           of  the  Ozone Layer;  and

      (b)   identifying areas in which further  research and  technical
           development are required,

3.   Urges all interested  parties  to participate in  and  contribute to  such a
workshop and  to make  expeditious use of the information  so  gained in order to
reduce the emissions  of those  substances and to develop  alternatives.

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                       3.  RESOLUTION OH REPORTING OP  DATA
 The Conference,

 Having adopted  the Hontreal  Protocol on Substances that Deplete the Ozone
 Layer,

 Convinced  chat  the timely  reporting of complete and accurate data on 'the
 production and  consumption of controlled substances is critical to the
 effective  and efficient  implementation of this Protocol,

 1.   Calls  upon all Signatories to take, expeditiously, all steps necessary to
 acquire  data and report  on the production, import and export of controlled
 substances  in a complete and timely fashion in accordance with Article 7 of the
 Protocol and taking into account paragraph 1 of Article 4 of the Vienna
 Convention  for the Protection of the Ozone Layer;

 2.   Invites Signatories to consult with other Signatories, and to seek advice
 and assistance from the  United Nations Environment Programme (UNEP) and other
 relevant international organizations, as necessary, in designing and
 implementing data  reporting systems;

3.   Calls upon the Executive Director of UNEP to convene, within six months of
the adoption of this Resolution, a meeting of governmental experts with  the
assistance of experts from relevant international organizations to make
recommendations for the  harmonization of data on production, imports and
exports to ensure consistency and comparability of data on controlled
substances.

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                     4.  TRIBUTE TO THE COVERUHEMT OP CAHADA
 The Conference,
 Havi°S °et in Montreal  from  14  to  16  September  1987 at the gracious invitation
 of the Governmen-t  of  Canada,

 Convinced  that the efforts made by the Government of Canada and by the civic
 authorities  of Montreal  in providing  facilities, premises and other resources
 contributed  significantly to the smooth  conduct of its proceedings,

 Deeply  appreciative of the courtesy and  hospitality extended by the Government
 of Canada  and  the  City of Montreal  to the members of the delegations, observers
 and the secretariat attending the  Conference,

 E;P.*;e88eg  jts  »in«™ gratitude to  the Government of Canada, to the authorities
of Montreal and, through them,  to  the Canadian people and in particular to the
population of Montreal for the  cordial welcome which they accorded to the
Conference and to  those associated with  its work and for their contribution to
the success of the Conference.

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            MONTREAL  PROTOCOL ON SUBSTANCES THAT DEPLETE THE OZONE LAYER



  The Parties to this Protocol,



                                  C°nvention for the Protection of  the Ozone


       Mindful  of  their obligation under that Convention to take appropriate
  measures  to protect  human health and the environment against advene  ejects
  resulting  or  likely  to result from human activities which modify or are  likely
  to modify  the ozone  layer,                                              n*eiy

       Recognizing that world-wide emissions of certain substances can
  significantly deplete and otherwise modify the ozone layer in a manner  that  is
  likely to  result in  adverse effects on human health and the environment,

      Conscious of the potential climatic effects of emissions of these
  substances,

      A-JLEl that measures taken to protect the ozone layer from depletion should
 be based on relevant scientific knowledge, taking into account technical and
 economic considerations,

      Determined to  protect the ozone layer by taking precautionary measures  to
 control  equitably total  global emissions of substances Chat deplete it,  with
 the  ultimate objective of their elimination on the basis of developments in
 scientific  knowledge, taking into account technical and  economic
 considerations,

     Acknowledging;  that  special  provision is required to meet the needs  of
 developing  countries for  these substances,

     Noting the precautionary  measures  for controlling emissions of certain
 levels      °Carb0n8  that  h*Ve  *lready been taken at nati°n«l and regional


     Considering  the  importance  of  promoting international co-operation in  the
research and development  of  science and  technology relating to the control  and
reduction of emissions of  substances  that deplete the ozone layer, bearing  in
mind in particular the needs of  developing countries,
     RAVE AGREED AS FOLLOWS:

-------
                             ARTICLE 1:  DEFINITIONS


      For  the pwposes of this Protocol:


 1.   "Convention" means the Vienna Convention for the  Protection of the Ozone
 Layer,  adopted on 22 March 1985.


 2.   "Parties" means, unless the text otherwise indicates,  Parties  to this
 Protocol.


 3.   "Secretariat" means the secretariat  of the Convention.


 4.   "Controlled substance" means a substance listed in Annex A to  this
 Protocol, whether existing alone or in a mixture.  It excludes,  however,  any
 such  substance or mixture which is in a manufactured product other than  a
 container used for the transportation or storage of the substance  listed.


 5.  "Production" means the amount of controlled substances produced minus the
 amount destroyed by technologies to be approved, by the Parties.


 6.  "Consumption" means production plus imports minus exports of controlled
 substances.
7.   "Calculated levels" of production, imports, exports and consumption means
levels determined in accordance with Article 3.


8.   "Industrial rationalization" means the transfer of all or  a  portion of  the
calculated level of production of one Party to another, for the purpose of
achieving economic efficiencies or responding to anticipated shortfalls  in
supply as a result of plant closures.

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                          ARTICLE 2:  CONTROL MEASURES

 1.   Each Party shall  ensure that for the twelve-month  period commencing on the
* first day of the seventh month following cne aate of the  entry  into force of
 this Protocol,  and  in  each  twelve-month period thereafter,  its  calculated level
 of consumption  of the  controlled substances in Group I  of Annex A does not
 exceed its calculated  level of consumption in 1986.  By the end of the same
 period, each Party  producing one or more of these substances shall ensure chat
 its calculated  level of production of the substances does not  exceed  its
 calculated level of production in 1986, except that such level  may have
 increased by no more than ten per cent based on the 1986 level.  Such increase
 shall be permitted  only so  as to satisfy the basic domestic needs of  the
 Parties operating under Article 5 and for the purposes of industrial
 rationalization between Parties.

 2.   Each Party shall  ensure that for the twelve-month period commencing  on the
 first day of the thirty-seventh month following the date of the entry into
 force of this Protocol, and in each twelve month period thereafter,  its
 calculated level of consumption of the controlled substances listed  in Group II
 of Annex A does not exceed  its calculated level of  consumption in 1986.   Each
 Party producing one or more of these substances shall ensure that its
 calculated level of production of the substances does not exceed its calculated
 level of production in 198b, except that such level may have increased by no
more  than ten per cent based on the 1986 level.  Such  increase shall be
 permitted only  so as to satisfy the basic domestic  needs of the Parties
 operating under Article 5 and for the purposes of  industrial rationalization
between Parties. The  mechanisms for implementing these measures shall be
decided by the  Parties at their first meeting following  the first scientific
 review.

3.    Each Party shall  ensure that for the period  I  July  1993 to 30 June  1994
and  in  each  twelve-month period thereafter,  its calculated  level of  consumption
of  the  controlled substances in Group I of Annex A  does  not exceed,  annually,
eighty  per cent of  its calculated level of  consumption  in  1986.  Each Party
producing one or more  of these substances  shall,  for  Che same  periods, ensure
that  its  calculated level of production of  the  substances  does not  exceed,
annually,  eighty per cent of its calculated  level  of  production  in  1986.
However,  in  order to satisfy the basic domestic  needs  of the  Parties operating
under Article 5 and for the purposes of  industrial rationalization  between
Parties,  its calculated level of production  nay  exceed that limit by up  to ten
per cent  of  its calculated  level of production  in 1986.

4.    Each Party shall  ensure that for  the  period 1 July 1998  to 30  June 1999,
and in  each  twelve-month period thereafter,  its  calculated level of consumption
of the  controlled substances in Group  I  of  Annex A does not exceed, annually,
fifty per cent  of its  calculated  level of  consumption in 1986.  Each Party
producing  one or more  of these substances  shall,  for the same periods,  ensure
that  its  calculated level of production  of  the  substances does not  exceed,
annually,  fifty per cent of its calculated level of production in 1986.
However,  in order to satisfy the basic domestic needs of the Parties operating
under Article S and for the purposes  of  industrial rationalization between
Parties,  its calculated level of production may exceed that limit by up to
fifteen per cent  of its calculated  level  of production  in  1986.  This

-------
  paragraph will apply unless the Parties  decide otherwise at a meeting by a
  two-thirds majority of Parties present and voting, representing at least
  two-.thirds of the total calculated  level of consumption of these substances of
  the Parties.  This decision shall be  considered and made in the light of the
  assessments referred to in Article  6.

  5.   Any Party whose calculated level of production in 1986 of the controlled
  substances in Group I of Annex A was  less ttian twenty-five kilotonnes may, for
  the purposes of industrial rationalization, transfer to or receive from any
 other Party,  production in excess of  the limits set out in paragraphs 1' 3 and
 4 provided that the total combined  calculated levels of production of the
 Parties concerned  does  not exceed the production  limits set out in this
 Article.   Any transfer  of such production shall be notified to the secretariat
 no later  than the  time  of the  transfer.                                       '

 6.  Any  Party not  operating under  Article 5, that has facilities for the
 production of  controlled  substances under construction, or contracted for,
 prior  to  16  September 1987,  and provided for in  national legislation prior to
 1 January 1987, may  add  the production from such  facilities to its 1986
 production of  such  substances  for the purposes of determining its calculated
 level  of  production  for  1986,   provided  that such facilities are completed by
 31 December 1990 and  that  such  production does not raise that Party's annual
 calculated level of  consumption of  the controlled substances above 0.5
 kilograms per  capita.

 7.   Any  transfer of production pursuant to paragraph 5 or any addition of
 production pursuant  to paragraph 6  shall be notified to the secretariat, no
 later than the time of the transfer or addition.

8.   (a)   Any Parties which are Member  States of a regional economic
           integration organization as defined in Article 1(6) of the
           Convention may agree that they shall jointly fulfil their
           obligations respecting consumption under this Article provided  that
           their total combined calculated level of consumption does not  exceed
           the levels required  by this Article.

     (b)    The Parties to any such agreement  shall inform the secretariat  of
           Che terms of  the agreement  before  the date of the reduction  in
           consumption with which the  agreement is concerned.

     (c)    Such agreement will  become  operative only if all Member States  of
           the  regional  economic integration  organization and the organization
           concerned  are Parties to  the Protocol and have notified the
           secretariat of their manner of implementation.

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 9.   (a)    Based  on  Che assessments made pursuant  to  Article 6, the Parties may
            decide whether:

           (i)   adjustments to the ozone depleting potentials  specified in
                Annex A should be made and, if so, what  the  adjustments should
                be;  and

           (ii)  further adjustments and reductions of production  or  consumption
                of the controlled substances from 1986 levels  should be
                undertaken and, if so, what the scope, amount  and timing of any
                such adjustments and reductions should be.

     (b)    Proposals  for such adjustments shall be communicated to the  Parties
           by the  secretariat at least six months before the meeting  of the
           Parties  at which they are proposed for adoption.

     (c)    In taking  such decisions, the Parties shall make every effort to
           reach agreement by consensus.  If all efforts at consensus have  been
           exhausted, and no agreement reached, such decisions shall, as a  last
           resort,  be adopted by a two-thirds majority vote of the Parties
           present  and voting representing at  least fifty per cent of the total
           consumption of the controlled substances of the Parties.

     (d)    The decisions, which shall be binding on all Parties,  shall forthwith
           be communicated to the Parties by the Depositary.  Unless otherwise
           provided in the decisions, they  shall enter into  force on the expiry
           of six  months from the date of the  circulation of the  communication
           by the  Depositary.

10.  (a)    Based on the assessments made pursuant  to  Article 6 of this  Protocol
           and in  accordance with Che procedure set out  in Article 9 of  the
           Convention, the Parties may decide:

           (i)   whether any substances, and if so which,  should  be  added  to  or
                removed from any annex  to  this Protocol;  and

           (ii}  the mechanism, scope and timing of  the  control measures that
                should apply to those substances;

     (b)   Any such decision shall become effective,  provided  that it  has  been
           accepted by a two-thirds majority vote  of  the Parties  present and
          voting.

11.  Notwithitand ing the provisions  contained in  this Article,   Parties may take
more stringent measures than those  required by this  Article.

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                      ARTICLE 3:   CALCULATION OP CONTROL LEVELS

       For the  purposes of Articles 2 and 5,  each  Party  shall, for each Group of
   substances  in Annex A, determine its calculated  levels of:

       (a)   production by:

            (i)   multiplying its annual production of  each controlled substance
                  by the ozone depleting potential specified in respect of it in
                  Annex A; and

            (ii)  adding together, for each  such  Group, the resulting figures;

      (b)   imports and exports,  re8Pectively, by  following, mutatis mutandis
            the procedure set out in subparagraph  (a);  and

      (c)   consumption by adding together its calculated levels of production
            and imports and  subtracting  its  calculated  level of exports as
            determined  in accordance with subparagraphs (a) and (b).  However
            beginning on  1  January 1993, any export of  controlled substances to
            non-Parties  shall not  be subtracted in calculating the consumption
            level of the  exporting  Party.


                   ARTICLE 4:  CONTROL OF TRADE WITH  NON-PARTIES

 1.  Within one year of  the  entry  into  force of this Protocol,  each Party shall
 ban the  import of controlled substances from any State not party to this
 Protocol.

 2.  Beginning on 1 January  1993, no Party operating under paragraph 1 of
 Article 5 may export  any controlled substance to any  State not party to this
 rrotoco I.                                                          '

 3.  Within three years of the date of the entry  into  force of this Protocol,
 the Parties shall,  following the procedures in Article 10 of the Convention
 elaborate in  an annex  a list of products containing controlled substances. '
 Parties that  have  not  objected to the annex in accordance with those procedures
 shall  ban  within  one  year of the annex having become effective, the import of
 those  products from any State not party to  this  Protocol.

 4.  Within  five  years  of the entry into force of this Protocol,  the Parties
 shall  determine  the feasibility of banning  or restricting, from States not
 party  to  this  Protocol,  the import of products produced with,  but not
 containing, controlled  substances.  If determined feasible, the Parties shall
 following the  procedures in Article 10 of  the Convention,  elaborate in an annex
a  list  of such products.   Parties that  have not  objected to it in accordance
with those procedures  shall  ban  or restrict,  within  one year of the annex
having become  effective,  the import of  those  products from any State not party
to  this Protocol.                                                             7

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5.  Bach Party shall  discourage che export, to any State  not  party to this
Protocol, of technology  for producing and for utilizing controlled substances.

6.  Each Party shall  refrain from providing new subsidies,  aid,  credits
guarantee* or  insurance  programmes for the export to  States not  party to this
Protocol of products, equipment, plants or technology that  would facilitate t
                                                                    *««e t
                      ,           ,   ans or  ecnoogy that would facilitate  the
  production of controlled  substances.                                 *««e  tne

  7.  Paragraphs  5  and 6  shall not apply to products, equipment,  plants  or
  techno ogy that  improve the containment, recovery, recycling or destruction  of
  controlled substances,  promote  the development of alternative substances   or
  otherwise  contribute to the reduction of emissions of controlled substances.

  8.   Notwithstanding the provisions of this Article, imports referred to  in
  paragraphs  1 , 3 and 4 may be permitted from any State not party to this
  Protocol if  that  State  is determined, by a meeting of the Parties, to  be  in
  full compliance with Article 2 and this Article, and has submitted data  to that
  effect  as  specified in Article 7.
              ARTICLE  5:   SPECIAL  SITUATION OF DEVELOPING COUNTRIES

 1.  Any Party that is  a developing country and whose annual calculated level of
 consumption of  the controlled substances is'less than.0.3  kilograms  per capita
 on the date of  the entry into force of the Protocol for it, or anytime' '
 thereafter within ten  years of the date of entry into force of the Protocol
 shall, in order,to meet its basic  domestic needs,  be entitled to delay its
 compliance with the control measures set out  in  paragraphs  1 to 4 of Article 2
 by ten years after that specified  in those paragraphs.   However, such Party
 shall  not exceed  an annual calculated level  of consumption  of 0.3 kilograms per
 capita.   Any such Party shall be entitled to  use either the average  of its
 annual calculated level of consumption for the period 1995  to 1997 inclusive or
 a  calculated level of  consumption  of 0.3 kilograms per  capita, whichever is the
 lower,  as the basis for its compliance with  the  control measures.

 2.  The Parties undertake  to facilitate access to  environmentally safe
 alternative  substances  and  technology for Parties  that  are  developing countries
 and assist then to  make expeditious  use of such  alternatives.

3.  The Parties undertake  to facilitate bilaterally or  multilaterally the
provision of  subsidies,  aid,  credits,  guarantees or insurance programmes to
Parties that  .re  developing  countries  for the use  of alternative technology and
for subscitutt products.

-------
               ARTICLE 6:  ASSESSMENT AND REVIEW OF CONTROL MEASURES

      Beginning  in 1990,  and at  lease every four years thereafter,  the  Parties
  shall assess tbe control measures provided for in Article 2 on the basia  of
  available scientific, environmental, technical and economic information.  At
  least one year  before each assessment, the Parties shall convene  appropriate
  panels of experts qualified in the fields mentioned and determine the
  composition and  terns of reference of any such panels.  Within one year of
  being convened,  the panels will report their conclusions, through the
  secretariat, to  the Parties.
                          ARTICLE  7:  REPORTING OF DATA

 1.        Each Party shall provide to the secretariat, within three months of
 becoming a Party, statistical data on its production, imports and exports of
 each of the controlled substances  for the year 1986, or the best possible
 estimates of such data where actual data are not  available.

 2.        Each Party shall  provide statistical data to the secretariat  on its
 annual  production (with separate data on amounts  destroyed by technologies to
 be approved by the Parties),  imports, and exports to Parties and non-Parties
 respectively,  of  such substances for the year during which it becomes a Parti
 and  for each year thereafter.  It  shall forward the data no later than nine
 months  after the  end of the year to which the data relate.
                           ARTICLE  8:   NON-COMPLIANCE

          The Parties, at  their  first meeting,  shall conaider and approve
procedures and institutional mechanisms  for  determining non-compliance with the
provisions of this Protocol and  for  treatment of  Parties found to be in
non-compliance.

-------
                ARTICLE 9:  RESEARCH, DEVELOPMENT,  PUBLIC AWARENESS
                            AND EXCHANGE OF INFORMATION

  1.  The Parties  shall co-operate,  consistent with their national laws,
  regulations and  practices  and  taking  into account in particular the needs  of
  developing countries,  in promoting, directly or through competent international
  bodies, research,  development  and  exchange of information on:

      (a)   best technologies  for  improving the containment, recovery, recycling
            or  destruction of  controlled substances or otherwise reducing  their
            emissions;

      (b)   possible  alternatives  to  controlled substances, to products
            containing  such  substances, and to products manufactured with  them-
            and                                                               '

      (c)    costs and benefits of  relevant control strategies.

  2.   The Parties,  individually, jointly or through competent international
  bodies, shall co-operate in promoting public awareness of the environmental
  effects of the emissions of controlled substances and other substances  that
  deplete the ozone layer.

  3.  Within two years of the entry into force of this Protocol and every  two
  years thereafter,  each Party shall submit to the secretariat a summary  of  the
  activities it  has  conducted pursuant to this Article.
                        ARTICLE  10:  TECHNICAL ASSISTANCE

 1.   The Parties shall,  in the context  of the provisions of Article 4 of the
 Convention,  and taking  into account in particular the needs of developing
 countries,  co-operate in  promoting technical assistance to facilitate
 participation  in and  imp lenient at ion of this Protocol.

 2.   Any Party  or Signatory to this Protocol may submit a request to the
 secretariat  for technical assistance for the purposes of implementing or
 participating  in the  Protocol.

 3; /?!.??*ti"i|  *C their first  neetin8, shall begin deliberations on the means
 of fulfilling  the obligations set  out  in Article 9,  and paragraphs 1 and 2 of
 this Article,  including the preparation of workplans.  Such workplans shall pay
 special attention to  the  needs and circumstances of  the developing countries.
 States  and regional economic  integration organizations not party to the
 Protocol should  be encouraged to participate in activities specified in such
workplans.

-------
                      ARTICLE 11:  MEETINGS OP THE PARTIES

 1.   The Parties shall hold meetings at regular intervals.  The  secretariat
 shall  convene tbe first meeting of the Parties not later than one year after
 Che date of the entry into force of this Protocol and  in conjunction with a
 meeting of the Conference of the Parties to the Convention,  if  a meeting of the
 latter is scheduled within that period.

 2.   Subsequent ordinary meetings of the Parties shall  be held,  unless  the
 Parties otherwise decide, in conjunction with meetings of  the Conference'of the
 Parties to the Convention.  Extraordinary meetings of  the  Parties  shall  be held
 at  such other times as may be deemed necessary by a meeting  of  the  Parties, or
 at  the written request of any Party, provided that, within six  months  of such a
 request being communicated to then by the secretariat, it  is supported by  at
 least  one third of the Parties.


 3.   The Parties, at their first meeting, shall:

     (a)   adopt by consensus rules of procedure for their meetings;

     (b)   adopt by consensus the financial rule*  referred to in paragraph 2 of
          Article 13;

     (c)   establish the panels and determine the  terms of reference referred to
          in Article 6;

     (d)   consider and approve the procedures  and  institutional mechanisms
          specified in Article 8; and

     (e)   begin preparation of vorkplans pursuant  to  paragraph 3 of Article 10.

4.  The functions of the meetings of the Parties  shall be to:

     (a)   review the implementation of  this Protocol;

     (b)   decide on any adjustments or  reductions referred  to  in  paragraph  9
          of  Article 2;

    (c)   decide on any addition to,  insertion in or  removal  from any annex of
          substances and on related control measures  in accordance with
          paragraph 10 of Article 2;

-------
      (d)

            Article  9;
           establish, where necessary,  guidelines or procedures for reporting  of
           information as provided  for  in Article 7 and paragraph 3 of
           Article 9;


      (e)   review requests for technical assistance submitted pursuant to
           paragraph 2 of Article 10;

      (f)   review reports prepared  by the secretariat pursuant to sub-
           paragraph (c)  of  Article 12;


     (g)   assess  in accordance with Article 6, the control measures provided
           for in Article 2;


     (h)   consider  and adopt,  as required, proposals for amendment of this
           Protocol  or any annex and for any new annex;


     (i)   consider  and adopt  the budget for implementing this Protocol; and

     (j)   consider  and undertake any additional action that may be required for
           the achievement of  the purposes of this Protocol.

 5.  The United Nations,  its specialized agencies and the International Atomic
 Energy  Agency, as well as any  State not party to this Protocol, may be
 represented at meetings of the Parties as observers.  Any body or agency
 whether national or  international,  governmental or.non-governmental, qualified
 in fields relating to the protection of the ozone layer which has informed the
 secretariat of its wish to be  represented at a meeting of the Parties as an
observer may be admitted unless at  least one third of the Parties present
object.  The admission and participation of observers shall be subject to the
rules of procedure adopted by  the Parties.
                            ARTICLE  12:   SECRETARIAT

For the purposes of chia Protocol, the  secretariat  shall:

    (a)   arrange for and service meetings  of  the Parties  as  provided  for in
          Article 11;


    (b)   receive and make available, upon  request  by  a  Party,  data provided
                   to Article 7;
    (c)    prepare an
-------
     (d)   notify the Parties of any request for technical  assistance received
           pursuant  to Article 10 so as to facilitate the provision of such
           assistance;

     (e)   encourage non-Parties to attend the meetings of  the Parties as
           observers and  to act in accordance with the provisions  of.this
           Protocol;

     (f)   provide,  as appropriate, the information and requests referred  to  in
           subparagraphs  (c) and (d) to such non-party observers;  and

     (g)   perform such other functions for the achievement of the purposes of
           this  Protocol  as may be assigned to it by the Parties.
                        ARTICLE 13:   FINANCIAL PROVISIONS

 1.  The funds  required  for the operation of this Protocol, including those for
 the functioning of the  secretariat related to this Protocol, shall be charged
 exclusively against contributions from the Parties.


 2.  The Parties, at their first meeting, shall adopt by  consensus financial
 rules for the  operation of this Protocol.
          ARTICLE 14:  RELATIONSHIP OF THIS PROTOCOL TO THE CONVENTION

    Except as otherwise provided  in this Protocol,  the provisions  of  the
Convention relating to its protocols shall apply  to this  Protocol.
                             ARTICLE  15:   SIGNATURE

    This Protocol shall be open for signature  by  States and by regional
economic integral ion organisations  in Montreal on 16 September 1987,  in Ottawa
from 17 September 1987 to 16 January  1988,  and at United Nations Headquarters
in New York fro* 17 January 1988  to IS  September  1988.
                                        12

-------
                           ARTICLE 16:  ENTRY  INTO FORCE




   l;..?l'ir°"^.e^:.f°<°.<°f" « ' J'°«'7  «»». P'.vu« ^ pr°vision8 of  Article l9 of the
  a?    j    •                            trtrft »xcCDt wxcn  r68Dccw Co % flrt i^^s
rererred Co in Daraaraoh 1  of Arr{/-i> ^   «... _.._w »__^       . . .
Protoco     .vin.                    '            "y m«y wt"w  ro»
protocol by giving written  notification to the Depositary  at any time after

Articl"J' °.  "§UBkin8.th«  °«>li8«ion. specified in paragraph. 1 to" o

the date »t  r" iuch.w"""«l «h-H t-ke effect upon expiry of one year after

          -    I ""^  y-' ' DeP°iic-ry. o' °n ««ch later date a. may be
          in the notification of the withdrawal.
                                      13

-------
                         ARTICLE  20:  AUTHENTIC TEXTS

    The original  of  this  Protocol, of which the Arabic,  Chinese,  English
French, Russian and  Spanish  texts  are equally authentic, shall be deposited
with the Secretary-General of the  United Nations.
                                     ' BENG DULY ADTHORIzro T0
   DONE AT MONTREAL THIS SIXTEENTH DAY OF SEPTEMBER, ONE THOUSAND NIHE
   HUNDRED AND EIGHTY SEVEN

-------
                                     ANNEX A
                              CONTROLLED SUBSTANCES
        Group
Substance
                                                              Ozone Depleting
                                                              Potential *
        Group I
                               CPC13   (CPC-11)
                               CP2C12   (CPC-12)
                               C2P3C13   (CPC-113)
                               C2?4C12   (CFC-114)
                               C2F5C1   (CFC-115)
                              1.0
                              1.0
                              0.8
                              1.0
                              0.6
       Group II
                               CP2BrCl  (halon-1211)
                               CF3Br  (halon-1301)
                               C2P^Br2  (halon-2402)
                               3.0
                              10.0
                       (to be determined)
       * These ozone depleting potentials are estimates based on existing
knowledge and will be reviewed and revised periodically.

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                ATTACHMENT K-2

CFG PRODUCTION/DSE DATA FOR SELECTED INDUSTRIAL
           AND DEVELOPING COUNTRIES

-------
                                              K-2-2





                                         ATTACHMENT K-2


                                            EXHIBIT 1


                   CFC-11 AND CFG-12 PRODUCTION/DSE FOR VARIOUS COUNTRIES
          240
          210
          180
          150


 Millions
   of     120
Kilograms


           90
           60
           30
            Australia
                 Austria

                      Brazil
  I
China
            I   I
Honduras   Indonesia!
     EEC
  Hong Kong
Japan
        Kuwait
Malaysia
           I
        Norway
                                                                           Sweden
                                                                                   U.S.
        Egypt
          India
    Korea
     Mexico
                                                     Thailand

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                                             K-2-3



                                        ATTACHMENT K-2

                                           EXHIBIT  2

                              CFC-11 AND CFG-12 PRODUCTION/USE
                              PER CAPITA FOR VARIOUS COUNTRIES
          .90
          .80  -
          .70
          .60
          .50
Kilograms
   per
 Capita
.40
          .30
         .20
          .10
                          Honduras   Indonesia!
             Australia
                 Austria
                      Brazil
                        Egypt
India
Korea
                                                                    Mexico
Thailand

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     K-2-4
ATTACHMENT K-2




   EXHIBIT 3
ASSUMPTIONS, DATA AND REFERENCES
CFC-11 +
CFC-12
a/ a/ Use/
Population GNP Production
(Thousands) (Millions) (Mill k*)

Australia
Austria

Brazil

China

EEC

Egypt
Honduras

Hong Kong

India

Indonesia

Japan

Korea

Kuwait

Malaysia

Mexico

Norway

Sweden

Thailand
U.S.

15,369
7,549

132,600

1,019,102

269,017

45,169
4,093

5,400

749,200

158,900

119,259

40,100

1,72

14,863

75,011

4,133

8,331

49,169
234,496

169,557
67,045

228,072

294;572

2,396,766

30,144
2,656

34,182

194,729

85,806

1,159,124

84,611

26,064

26,679

157,372

55,650

99,750

38,864
3,176,670
c/
12.0
5.2~
m/
8.9
e/
18.0
f/
228.5
S/
^•*
2.9
0.2
n/
1.7
o/
0.4
21
*•*
5.4
h/
57.5
a/
•«•
3.1
i/
1.0
i/
«fc*
1.4
k/
5.2
I/
0.7
I/
3.6
&/
Sm*
2.0
197. 4~
FOR EXHIBITS 1 AND 2
CFC-11 + CFC-11 +
CFC-12 CFC-12
Use Per Use (kg)
Capita Per $
(kg) Bill GNP

0.78
0.69

0.07

0.02

0.85

0.06
0.04

0.32

0.001

0.03

0.48

0.08

0.60

0.09

0.07

0.18

0.43

0.04
0.84

0.07
0.08

0.04

0.06

0.10

0.10
0.08

0.05

0.002

0.06

0.05

0.04

0.04

0.05

0.03

0.01

0.04

0.05
0.06
Year
of Use/
Production
Data

1984
1985

1985

NA

1985
.
1985 •
1984

1985

1982

1984

1985

1985

NA

NA

1983

1984

1984

1984
1985

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                                       K-2-5



                                   ATTACHMENT K-2

                                EXHIBIT 3  (continued)

               ASSUMPTIONS,  DATA AND REFERENCES FOR EXHIBITS 1 AND 2
 a/   The World  Bank,  (1986),  "The World Bank Atlas,  1986," Washington, D.C
     Numbers  reflect  1983 estimates  for GNP and Population.  GNP  is  in real
     U.S.  1982  dollars.

 b/   United States  International Trade Commission,  (1986), "Preliminary Report
     on  U.S.  Production of Selected  Synthetic Organic Chemicals (Including
     Synthetic  Plastics and Resin Materials) July through September, October
     thru December, and Cumulative Totals 1986," USITC, Washington, D.C.,
     February 20, 1986.  Imports and exports were not considered.  1985
     production estimates.

 c/   Department of Arts, Heritage and Environment, Australia,  (1986),
     Australian Submission to UNEP Workshop on Chlorofluorocarbons. submitted
     for Topic  1 of the UNEP Chlorofluorocarbon Workshop, Rome, Italy, May 1986.

 d/   Austria, (1986), Current Use of CFCs in Austria, prepared by the Austrian
     Delegation for Topic 1 of the UNEP Chlorofluorocarbon Workshop, Rome,
     Italy, May 1986.  Estimate net use of all CFCs.

 e/   Zhijia, W., (1986), Country Paper for Topic 1. prepared by the National
     Environmental Protection Agency of the People's Republic of China for
     Topic 1 of the UNEP Chlorofluorocarbon Workshop, Rome, Italy, May 1986.
     Net use of all CFCs.

 f/   EFCTC, UNEP Chlorofluorocarbon Workshop 1986, Phase I "CFC Production and
     Use Statistics for the EEC 1976 to 1985" Rome, May 1986.  Total Sales.

&/   United Nations Environment Programme, (1986), Background Factual Papers on
    Current Production Capacity. Use.  Emissions.  Trade and Current Regulation
    of CFCs Separately by Country and/or Region.   Topic 1 — Overview.
    prepared for UNEP Workshop on Chlorofluorocarbons, Rome, Italy,  May 1986
    Estimates net use of  all CFCs.

h/  Kurosawa, K.,  and K.  Imazeki,  (1986), Paper for CFCs Workshop, submitted
    by Japan for Topic 2  of the UNEP Chlorofluorocarbon Workshop, Rome,  Italy
    May 1986.                                                               "

i/  United National Environment Programme,  (1986),  Draft Report of the Second
    Part of the Workshop  on the Control  of  Chlorofluorocarbons.  UNEP/WG.148/3/
    L.l/Corr. 1,  11 September 1986.   Estimate net use of all CFCs.

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                                         K-2-6



                                     ATTACHMENT K-2

                                EXHIBIT 3 (continued)

                 ASSUMPTIONS, DATA AMD REFERENCES FOR EXHIBITS 1 AND 2
 j/   Department  of Environment, Malaysia,  (1986), Country Report.  Chlorofluoro-
     carbon  Chemicals  in Malaysia, submitted  for Topic  1 of the UNEP
     Chlorofluorocarbon Workshop, Rome,  Italy, May 1986.  Estimate use of
     CFC-11,  CFC-12 and CFC-22.

 k/   Ostman,  A., P. Bohm, and I. Kokeritz,  (1986), Current Use of CFCs in
     Sweden  and  Norway, prepared for the Swedish Environment Protection Board
     and submitted for Topic 1 of the UNEP  Chlorofluorocarbon Workshop, Rome,
     Italy,  May  1986.  Estimates for 1984 use.

 j./   Perez,  A.R.A., (1986), National Panorama of Chlorofluorocarbons. prepared
     by Secretaria de Desarrollo Urbano y Ecologia for  the UNEP Chlorofluoro-
     carbon  Workshop Rome, Italy, May 1986.  Estimates  of total CFC consumption.
     No production or export data reported.  Country contains two producing
     plants.

 m/   Banco Do Brasil S.A. (1985), Carteira  Do Comercio  Exterior. Brasil, and
     United  Nations Environment Programme,  (1986) Topic 1 - Overview prepared
     for UNEP Workshop on Chlorofluorocarbons, Rome, Italy, May 1986.
     Use/production calculated as Imports - Exports + Production.

 n/   Census  and Statistics Department (1985), Hong Kong Trade Statistics. Hong
     Kong.   Product coverage includes Dichlorofluormethane,
     Trichlorofluoromethane and Dichlorodifluormethane  mix Trichloro-
     fluoromethane.  Production/use calculated as Imports-Exports + Production.

 o/   Directorate General of Commercial Intelligence and Statistics, (1982),
     Monthly Statistics of the Foreign Trade of India.  Calcutta, India.
     Product coverage includes "other halogenated derivatives of hydrocarbons."
     Use/Production calculated as Imports - Exports + Production.

E/   Biro Pusat Statistik (1984), Indonesia Foreign Trade Statistics. Jakarta
     Indonesia.  Product coverage includes  "other halogenated derivatives of
     hydrocarbons."  Use/Production calculated as Imports - Exports +
     Production.

3/   Office of Customs Administration (1985), Statistical Yearbook of Foreign
    Trade, Seoul,  Republic of Korea.  Product Coverage includes
    Chlorofluoromethanes.   Use/Production calculated as Imports - Exports +
     Production, production assumed to be zero.

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            ATTACHMENT K-3

CFC IMPORT DATA FOR SELECTED INDUSTRIAL
       AND DEVELOPING COUNTRIES

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                                      K-3-2



                                ATTACHMENT K-3

                                    EXHIBIT  1

              UNITED STATES  IMPOSTS OF  CFCS 11 AND 12  (1)
QUANTITY: Metric Torn
Major Supplier*
Belgium
Netherlands
France
W. Germany
Italy
United Kingdom
Other EEC
Canada
United State*
Japan
Other*
_
TOTAL
1982
•••••••••I
0
0
555
0
0
2,378
0
0
0
0
42
2,975
1983
•••• *HaU 81
0
0
1,343
0
0
4,246
0
320
0
0
249
6,158
1984
130
207
1,054
0
0
5,906
0
1.223
0
0
191
8,711
1985
89
0
567
0
92
1,484
125
8
0
0
222
2,587
1986
0
95
931
787
0
6,231
1,890
1,031
0
0
672
11.637
VALUE: Thousand* of U.S. Dollars
Major Supplier*
1982
1983
 1984      1985      1986
•••••••••••••••••••••••••a
Belgiua |
Netherlands
France
W. Germany
Italy
United Kingdom
Other EEC
Canada
United State*
Japan
Other*
TOTAL
0
0
266
0
0
1,068
0
0
0
0
35
1,369
0
0
725
0
0
1,838
0
155
•0
0
148
2,866
141
101
679
0
0
2,990
0
555
0
0
116
4,582
111
0
655
0
111
1,460
261
10
0
5
65
2,678
0
98
967
964
10
4,942
1,134
1,041
0
47
898
10,101
 Source: United States Department of Commerce, Bureau of the Census.
        "U.S. Imports for Consumption and General  Imports". Washington, O.C.

 (1) Product description  is "Trichlorofluoromtthane and Dichlorodifluoro-
     methane.

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                                  K-3-3



                            ATTACHMENT K-3

                               EXHIBIT  2

              UNITED STATES IMPORTS OF CFCS  22  (1)
QUANTITY: Metric Tons
Major Suppliers     1982
         1983
         1984
         1985
VALUE: Thousands of U.S. Dollars
Major Suppliers
1982
1983
1984
1985
        1986
Belgium
Netherlands
France
U. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Others
TOTAL
0
0
0
0
0
6,997
0
0
0
0
75
7,072
0
0
336
0
0
7,955
0
0
0
0
105
8,396
228
0
508
0
0
10.149
0
889
0
0
0
11,774
188
0
142
82
0
755
0
0
0
0
52
1,219
43
2,670
1,167
341
0
4,516
369
943
0
0
0
10,049
1986
Belgium
Netherlands
France
U. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Others
TOTAL
0
0
0
0
0
5.496
0
0
0
0
62
5,558
0
0
301
0
6,344
0
0
0
0
0
87
6,732
179
0
476
0
0
7,625
0
443
0
0
2
8,725
351
0
246
124
0
1.128
0
0
0
0
70
1,919
57
606
1,909
625
0
6,626
1,183
104
0
0
0
11,110
 Source: United States Department of Commerce. Bureau of the Census.
        "U.S.  Imports for Consumption and General Imports11. Washington,  D.C.

 (1) Product description is "Chlorodifluoromethane*.

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                                 K-3-4









                            ATTACHMENT K-3




                               EXHIBIT  3




                  CANADIAN IMPORTS OF  CFG 11  (1)
QUANTITY: Netrie Tons
Major Suppliers      1982
         1983
         1984
         198S
VALUE:  Thousands of U.S. Dollars
Major Suppliers
1982
1983
1984
1985
Source: OKI, 1987,  and various country sources.




(1) Product description is "Triehlorofluoremethane1*.
         1986
Belgium
Netherlands
France
U. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Others
TOTAL
3
0
0
0
0
0
0
0
7
0
0
10
0
0
0
0
0
0
0
0
4
0
0
4
0
0
20
0
0
35
0
0
11
0
0
66
0
0
0
0
14
0
0
0
20
31
0
65
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
                                     1986
Belgium
Netherlands
France
W. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Others
TOTAL
!•••••*•••!
5
0
0
0
0
0
0
0
7
0
0
12
0
0
0
0
0
0
0
0
7
0
0
7
0
0
15
0
0
23
0
0
5
0
0
43
0
0
0
0
12
0
0
0
30
30
0
72
••••••I
N/A
N/A
N/A
N/A
N/A
M/A
N/A
N/A
N/A
N/A
N/A
N/A

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                                  K-3-5









                            ATTACHMENT  K-3




                               EXHIBIT 4




                   CANADIAN  IMPORTS OF CFG  12 (1)
QUANTITY:  Metric Ton*
Major Suppliers
Belgium
Netherlands
France
W. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Other
TOTAL
VALUE: Thousands o1
Major Suppliers
Belgium
Netherlands
France
W. Germany
Italy
United Kingdom
Other EEC
Canada
United statea
Japan
Other
TOTAL
1982
25
0
0
0
0
89
0
0
224
0
0
338
1 U.S. Ool
1982
47
0
0
0
0
109
0
0
469
0
1
626
1983
39
0
0
0
0
190
0
0
276
0
0
SOS
ars
1983
63
0
0
0
0
258
0
0
640
0
4
965
1984
•••••••••I
23
35
27
0
0
228
0
0
353
0
11
677

1984
36
0
42
0
0
313
0
0
797
0
69
1,257
1985
10
0
107
0
14
408
0
0
277
31
2
851

1985
(••••••••3!
11
0
175
0
0
464
0
0
563
0
1
1,214
1986
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A

1986
!•••••••••
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Source: OKI, 1987, and various country sources.




(1) Product description is "Oichlorodifluoromethane".

-------
                                   K-3-6
                             ATTACHMENT  K-3




                                EXHIBIT 5




                     FRENCH IMPORTS OF  CFG  22  (1)
 QUANTITY: Metric Tons
 Major Suppliers
1982
                             1983
                  1984
                                               198S
Source: ORI,  1987, and various country sources.




(1)  Product description is "Chlorodifluoromethane".
                                                        1986
Belgium
Netherlands
Franc*
W. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Other
TOTAL
0
10
0
0
870
0
78
0
0
0
0
958
0
44
0
77
900
0
475
0
0
0
2
1,498
0
3
0
14
506
0
132
0
0
0
5
660
0
1
0
7
953
0
74
0
0
0
7
•1,042
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
I N/A
VALUE: Thousands of U.S. Dollars
Major Suppliers 1982 1983 1984 1985 1986
Belgium
Netherlands
France
W. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Other
TOTAL
0
12
0
0
922
0
88
0
0
0
0
1,022
0
42
0
95
841
0
474
0
0
0
5
1,457
0
4
0
20
532
0
119
0
0
0
5
680
0
2
0
10
724
0
81
0
0
0
7
824
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A

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                                  K-3-7









                            ATTACHMENT K-3




                                EXHIBIT 6




                    FRENCH IMPORTS OF CFG 12  (1)
QUANTITY: Mttric Tons
Major Suppliers     1982
1983
1984
198S
VALUE:  Thousands of U.S. Dollars
Source: OR!, 1987, and various country sources.




(1)  Product description is "Oichlorodifluoromthano*.
                           1986
Belgium
Netherlands
Franc*
W. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Other
TOTAL
4
328
0
756
857
2
942
0
13
0
1
2,903
IS
600
0
881
567
2
1,014
0
21
0
60
3,160
12
623
0
842
561
1
678
0
20
0
10
2,747
11
288
0
980
555
3
822
0
63
0
12
2,734
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Major Suppliers
Belgium
Netherlands
France
w. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Other
TOTAL
1982
5
312
0
880
674
21
693
0
98
0
1
2,684
1983
20
504
0
993
414
26
781
0
113
0
61
2,912
1984
17
524
0
777
407
13
418
0
115
0
13
2,284
1985
11
257
0
951
408
7
543
0
155
0
39
2,371
1986
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A

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                                     K-3-8



                               ATTACHMENT K-3

                                  EXHIBIT  7

                WEST GERMAN IMPORTS  OF MIXED DERIVATIVES
                          OF ACYCLIC HYDROCARBONS
 QUANTITY: Metric Tons

Major Suppliers
Belgium
Netherlands
France
W. Germany
Italy
United Kingdom
Other EEC
Canada .
United States
Japan
Other
TOTAL

1982
120
8,521
1.207
0
5,077
594
83
3
173
59
34
15,871

1983
171
8,296
1,321
0
4,679
841
355
2
173
0
138
15,976

1984
71
9,660
1,351
0
5,002
875
1,647
26
92
0
111
18.835

198S
57
9,965
2,872
0
6.240
976
1,378
0
61
0
177
21,726
Nov YTO
1986
157
9,954
3,353
0
5,081
946
1,469
0
35
61
840.
21,896
VALUE: Thousands of U.S. Dollars
Nov YTD
Major Suppliers 1982 1983 1984 1985 1986
Belgiun
Netherlands
France
U. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Other
TOTAL
104
8,609
1,810
0
4,342
1,384
114
69
400
208
38
17,078
165
8,761
2,210
0
4,080
1,660
500
39
492
0
121
18,028
120
10,428
2,813
0
4,045
1,562
1,668
0
349
43
79
21,107
101
9.805
4,200
0
4,926
1,706
1,421
0
214
64
182
22,619
233
14,099
7,432
0
7,201
1,933
2,298
0
221
180
162
33,759
Source: OR!, 1987, and various country sources.
       Exchange Rate from Federal  Republic of Germany,  Frankfurt Exchange.

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                                K-3-9



                           ATTACHMENT K-3

                              EXHIBIT  8

                  ITALIAN IMPORTS OF CFG 22  (1)
QUANTITY: Metric Tons
Major Suppliers      1982
1983
1984
       Nov YTO
198S      1986

Belgiun
Netherlands
France
w. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Other
TOTAL
0
0
0
7,763
0
0
0
0
0
0
3,864
11.627
0
0
2,730
6,905
0
0
0
0
0
0
3,349
12,984
0
0
534
362
0
0
0
0
0
0
798
1,694
0
0
48
0
0
0
0
0
0
0
267
315
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
VALUE: Thousands of U.S. Dollars
Nov YTD
Major Suppliers 1982 1983 1984 1985 1986
Belgiun
Netherlands
France
W. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Other
TOTAL
»»•••••••!
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
mmmmmmmmmmi
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
••••••••
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Source: ORI,  1987, and various country sources.

(1) Product description is "Chlorodifluoromethane".

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                                  K-3-10



                             ATTACHMENT K-3

                                EXHIBIT  9

               UNITED KINGDOM IMPORTS OF CFG 12 (1)
QUANTITY:  Metric Tons
Major Suppliers     1982
                             1983
                  1984
                  1985
VALUE:  Thousands of U.S. Dollars
Major Suppliers
1982
1983
                                      1984
1985
                                                        1986
Belgium
Netherlands
France
W. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Other
TOTAL
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
3,631
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
5,501
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
5,660
!•••••••••!
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
6,822
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
6,671
                                     1986
Belgium
Netherlands
France
W. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Other
TOTAL
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
2,417
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
3,936
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
4.797
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
6,364
!••••••••!
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
5,167
Source: ORI, 1987,  and various country sources.
       Exchange Rate from International Monetary Fund, 1986.
       "International Financial Statistics". Washington,  O.C.

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                                    K-3-11



                               ATTACHMENT K-3

                                 EXHIBIT 10

             NORWEGIAN IMPORTS OF -OTHER HALOGENATED
                       DERIVATIVES  OF HYDROCARBONS"
QUANTITY: Metric Tons
Major Suppliers      1982
         1983
         1984
         198S
VALUE: Thousands of U.S. Dollars
Major Suppliers
1982
1983
1984
1985
         1986
Belgium
Netherlands
France
W. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Others
TOTAL
0
55
0
231
0
91
0
0
0
0
50
427
87
S3
54
242
0
576
0
0
0
0
9
1,021
18
27
0
558
0
SS
9
0
0
0
s
672
N/A
N/A.
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
•••••••
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
1986
Belgium
Netherlands
France
W. Germany
Italy
United Kingdom
Other EEC
Canada
United States
Japan
Others
TOTAL
0
49
0
247
0
153
0
0
0
0
94
543
194
59
89
197
0
667
0
0
0
0
11
1,217
54
38
0
48S
0
91
0
0
0
0
45
713
•••••••*••
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
•••••••
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Source:  Central Bureau of Statistics.  "External  Trade". Oslo. Norway.
        Exchange rate from;  International Monetary Fund, 1986. "International
        Financial Statistics Yearbook11. Washington, O.C..

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                                      K-3-12



                                ATTACHMENT  K-3

                                   EXHIBIT 11

        NEWLY INDUSTRIALIZING COUNTRIES' IMPORTS  OF  CFCS (1)
QUANTITY: Metric Tone
Brazil
Egypt
Honduras
Hong Kong
India
Indonesia
Korea
Malaysia
Mexico
Thailand

TOTAL
                    1982
1983
1984
1985
                                                          1986
N/A
N/A
M/A
N/A
448
N/A
N/A
N/A
N/A
N/A
448
N/A
M/A
N/A
968
N/A
5.195
2,291
N/A
N/A
1.190
9.644
43
N/A
N/A
1087
N/A
5.679
3.776
N/A
N/A
1.303
11.888
12
N/A
N/A
1725
N/A
N/A
3.563
N/A
N/A
1,180
6.480
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
VALUE: Thousands of U.S.  Dollars
                    1982
1983
1984
1985
1986
Major Suppliers
Brazil
Egypt
Honduras
Hong Kong
India
Indonesia
Korea
Malaysia
Mexico
Thailand

TOTAL
(1) The product description  for each country's  imports follows the source list

Sources:
  Banco Do Brasil S.A.,  "Cartelre Do Comercio Exterior". CFC 11 & 12

  Census * Statistics Department. "Hong Kong Trade Statistics". Hong Kong.
  Dlchlorodifluoromethane. Trichlorofluoromethane and Dichlorodtfluoromethane
  Nix Trichlorofluoromethane.
N/A
N/A
N/A
N/A
299
N/A
N/A
N/A
N/A
N/A
299
N/A
N/A
N/A
1009
N/A
N/A
N/A
N/A
N/A
1,936
2,945
N/A
N/A
N/A
1132
N/A
N/A
N/A
N/A
N/A
1,970
3,102
N/A
N/A
N/A
1859
N/A
N/A
N/A
N/A
N/A
1,815
3,674
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A

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                                       K-3-13



                                  ATTACHMENT  K-3

                             EXHIBIT 11  (continued)

          NEWLY INDUSTRIALIZING  COUNTRIES'  IMPORTS OF CFCS (1)
Directorate General of Coomerclal Intelligence and Statistics.  "Monthly
Statistics of  the Foreign Trade of India". Calcutta,  India. Other

Halogenated Derivatives of Hydrocarbons.

Biro Pusat statistik. "Indonesia  Foreign trade Statistics*.  Jakarta. Indone
Other Halogenated Derivatives of  Hydrocarbons.

Office of Custom Administration. "Statistical Yearbook of Foreign Trade".
Republic of Korea.  Chlorofluoromethanes 1.

Department of Customs.  "Foreign trade Statistics of Thailand".  Bangkok,
Thailand.  Freons.

-------
                ATTACHMENT K-4

U.S. IMPORT DATA FOR CFC-RELATED PRODUCTS FROM
 SELECTED INDUSTRIAL AND DEVELOPING COUNTRIES

-------
                                                                  ATTACHMENT  K-4

                                                                      EXHIBIT 1

                                          U.S.  MARKET FOR  SELECTED CFG-RELATED  EXPORTS
COUNTRY
EEC
Belgiug-Luxenfeourg
Denmark
France
Germany
Greece
Ireland
Italy
Netherlands
Portugal
Spain
United Kingdom
Brazil
Canada
China
EWpt
Honduras
Hong Kong
India
Indonesia
Japan
Korea
Malaysia
Mexico
Norway
Phlllpines
liedT'
Taiwan
Thailand
Turkey
TOTAL WORLD EXPORTS
(S Millions)
310.660
16.464
16.660
45.668
108.094
1.764
3.136
40.572
17.738
1.960
9.016
49.588
N/A
87.145
N/A
N/A
N/A
N/A
N/A
N/A
209.200
34,700
13,800
N/A
N/A
N/A
22.800
N/A
44.272
N/A
N/A
TOTAL EXPORTS TO U.S.
($ Millions)
79,516
4 191
1 869
10.586
26,128
436
1 045
11.311
4,363
600
2.955
16,032
7,340
68.700
5.241
123
486
944
2.465
3,675
80.500
13,500
2,534
17,558
4,637
2,150
4,884
N/A
21.251
1,873
690
                                                                                   TOTAL VALUE OF SELECTED

                                                           U.S. SHARE OF COUNTRY'S       PRODU^KPORTS
                                                           TOTAL EXPORT MARKET    (S Hi 11 ions)
                                                                    2S.60X
                                                                    25.46X
                                                                    11.22X
                                                                    23.18X
                                                                    24.17X
                                                                    24.72X
                                                                    33.32X
                                                                    27.88X
                                                                    24.60X
                                                                    30.61X
                                                                    32.7BX
                                                                    32.33X

                                                                       N/A
                                                                    78.83X
                                                                       N/A
                                                                       N/A
                                                                       H/A
                                                                       N/A
                                                                       N/A
                                                                       N/A
                                                                    38.48X
                                                                    38.90X
                                                                    18.36X
                                                                       N/A
                                                                       N/A
                                                                       N/A
                                                                    21.42X
                                                                       N/A
                                                                    48.00X
                                                                       N/A
                                                                      N/A
 12787
   126
    3
   276
 10295
    0
    0
   219
    3
    2
    2
 I860

  257
 2383
    0
    0
    0
    1
    3
    0
45838
 3550
  313
 3524
    0
    3
 2342
 1873
 3666
    0
    1
1) World Exports 1 Exports to U.S. Sources:  EEC: (Data for Dec.- Nov,  1986} EEC Trade Statistics Book 2. 1986; and
                                         Bureau of the Census. U.S. Department of Coimerce. 1987
                                        Canada: U.S. Department of Comnerce
                                        Japan: Japanese Embassy Cable
                                        Korea: Bank of Korea
                                        Malaysia & Sinagapore: U.S. Department of Comerce
                                        Taiwan: U.S. Department of Comnerce, Bureau of the Census
  Additional Notes:                          "" °f the Census- u-s- Department of Comnerce. 1987. -Highlights of U.S

  TOTAL KSSllX?o"iV T°J8i f K'i11? °'  f" froduet export8 for the  "lected country.
  IUIHL EXPORTS TO U.S. o Tntnl S Wnlm A«  -i i —«_—*- *_ »•._ •. _  *__ ..          . *
MARKET SHARE OF
EXPORTS TO U.S.
16.08X
3.01X
0.18X
2.61X
39.40X
0.05X
O.OOX
1.94X
0.07X
0.3ZX
0.06X
11.60X
3.49X
3.47X
O.OOX
O.OOX
O.OOX
0.12X
0.12X
O.OOX
56.94X
26.30X
12.3SX
20.07X
N/A
0.16X
47.95X
N/A
17.25X
O.OOX
0.08X
MARKET SHARE OF
WORLD EXPORTS
4.12X
0.77X
0.02X
0.60X
9.52X
0.01X
O.OOX
O.S4X
0.02X
0.10X
0.02X
3.75X
N/A
2.73X
N/A
N/A
N/A
N/A
N/A
N/A
21.91X
10.23X
2.27X
N/A
N/A
N/A
10.27X
N/A
8.28X
N/A
N/A
                                                                                                                                                               I
                                                                                                                                                              •p-
                                                                                                                                                               I
                                                                                                                                                              ro
                                                                                                            Export and  Import Trade". Washington. O.C.
!J!!fF*..??/i? 2' **°*^ curvnia - 9 VBIUC or product/ * Value Of TOTAL WORLD EXPORTS
                                                                                                        lectronlcs * Refrigeration * Foan Products

-------
                                        ATTACHMENT K-4


                                            EXHIBIT  2


U.S.  MARKET  FOR SELECTED  CFG-RELATED  EXPORTS:   AIR CONDITIONERS
COUNTRY

EEC
Belgian-Luxembourg
Denmark
France
Germany
Greece
Ireland
Italy
Netherlands
Portugal
Spain
United Kingdom
Brazil
Canada
China
Egypt
Honduras
Hong Kong
India
Indonesia
Japan
Korea
Malaysia
Mexico
Norway
Phil (pines
Singapore
Sweden
Taiwan
Thailand
Turkey
TOTAL UORLD EXPORTS
(S Millions)
310.660
16.464
16,660
45,668
108.094
1.764
3,136
40,572
17,738
1,960
9,016
49,588
N/A
87,145
N/A
N/A
N/A
N/A
N/A
N/A
209,200
34.700
13.800
N/A
N/A
N/A
22.800
N/A
44.272
N/A
N/A
TOTAL EXPORTS TO U.S.
(( Millions)
79,516
4,191
1,869
10.586
26, 128
436
1,045
11,311
4,363
600
2,955
16,032
7,340
68.700
5.241
123
486
944
2.465
3,675
80,500
13,500
2.534
17.558
4,637
2.150
4,884
N/A
21,251
1.873
690
                         U.S. SHARE OF COUNTRY'S
                         TOTAL EXPORT MARKET    <
                                 25.60X
                                 25.46X
                                 11.22X
                                 23.18X
                                 24.17X
                                 24.72X
                                 33.32X
                                 27.88X
                                 24.60X
                                 30.61X
                                 32.78X
                                 32.33X

                                    N/A
                                 78.83X
                                    N/A
                                    N/A
                                    N/A
                                    N/A
                                    N/A
                                    N/A
                                 38.48X
                                 3B.90X
                                 1B.36X
                                    N/A
                                    N/A
                                    N/A
                                 21.42X
                                    N/A
                                 4B.OOX
                                    N/A
                                    N/A
EXPORTS OF A/C
ONOIT10NERS MARKET SHARE OF
0 U.S. EXPORTS TO U.S.
OS)

0
0
0
3
0
0
1
0
0
o
1
33
1
0
0
0
1
1
0
214
4
2
31
0
0
7
0
1
0
0
(Units)
3. 284
H/A
0
N/A
1.742
0
0
881
531
0
N/A
130
174.062
2.184
0
0
0
3,323
0
0
502.518
22.903
9.697
11.073
0
0
34.390
13
2.471
0
0

0.01X
o.oox
o.oox
o.oox
0.01X
o.oox
o.oox
0.01X
o.oox
o.oox
o.oox
0.01X
0.45X
o.oox
o.oox
o.oox
o.oox
0.08X
0.06X
o.oox
0.27X
0.03X
0.08X
0.17X
O.OOX
o.oox
0.14X
N/A
O.OOX
O.OOX
O.OOX
A/C
MARKET SHARE OF
UORLD EXPORTS

O.OOX
O.OOX
O.OOX
O.OOX
O.OOX
O.OOX
o.oox
o.oox
o.oox
o.oox
o.oox
o.oox
N/A
o.oox
N/A
N/A
N/A
N/A
N/A
N/A
0.10X
0.01X
0.01X
N/A
N/A
N/A
0.03X
N/A
O.OOX
N/A
N/A
A/C
TOTAL PRODUCTION SHARE
PRODUCTION EXPORTED TO U.S.
S
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A

N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
                                                              1986;  and
1) World Exports ft Exports to U.S. Sources: EEC: {Data for Dec.- Nov. 1986J EEC Trade Statistica Book 2.
 '       "•"•        "~                     Bureau of the Census, U.S. Department of Comnerce, 1987
                                       Canada: U.S. Department of Comnerce
                                       Japan: Japanese Embassy Cable
                                       Korea: Bank of Korea
                                       Malaysia ft Sinagapore: U.S. Department of Commerce
                                       Taiwan: U.S. Department of Comnerce, Bureau of the Census
                                       Bureau of the Census, U.S. Department of Comnerce. 1987. "Highlights of U.
2) Source: Department of Commerce. 1986. "United States General  Imports and Imports for Consumption". Washington D.C..

   Additional  Notes:
   TOTAL UORLD EXPORTS = Total t Value of all product exports for the selected country.
   TOTAL EXPORTS TO U.S. « Total * Value of alt exports to the U.S. for the selected country.
   U.S. SHARE  OF COUNTRY EXPORT MARKET = TOTAL EXPORTS TO U.S./TOTAL UORLD =><«*«
   MARKET SHARE OF EXPORTS TO U.S. = * Value of Product/ * Value of TOTAL EXPORTSTO U.S.
   MARKET SHARE OF UORLD EXPORTS ' t Value of Product/ » Value of TOTAL UORLD EXPORTS
   TOTAL PRODUCTION • * Value of product manufactured in the selected country.   ___._„_
   PRODUCTION  SHARE EXPORTED TO U.S. = ( Value of Product exported  to U.S./ TOTAL PRODUCTION
                                                                          S. Export and Import Trade". Hashington. D.C.

-------
                                                                         ATTACHMENT  K-4

                                                                              EXHIBIT  3

                                     U.S.  MARKET TOR SELECTED CFC-RELATED EXPORTS:    AUTOMOTIVE
                                                                                      TOTAL EXPORTS OF
                                                                                         AUTOMOBILES
     COUNTRY

EEC
  Betgiun-Luxembourg
  Dernark
  France
  Germany
  Greece
  Ireland
  Italy
  Netherlands
  Portugal
  Spain
  United Kingdom

Brazil
Canada
China
Egypt
Honduras
Hong Kong
India
Indonesia
Japan
Korea
Malaysia
Mexico
Norway
Phlllpfnes
Singapore
Sweden
Taiwan
Thailand
Turkey
 16,660
 45.668
108.094
  1.764
  3.136
 40.572
 17.738
  1.960
  9.016
 49.588

    N/A
 87.145
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
209,200
 34.700
 13.800
    N/A
    N/A
    N/A
 22,800
    N/A
 44,272
    N/A
    N/A
                                                   1  (US
                                                    '
                                                     600
                                                   2,955
                                                  16,032

                                                   7,340
                                                  68,700
                                                   5,241
                                                     123
                                                     486
                                                     944
                                                   2,465
                                                   3,675
                                                  80,500
                                                  13,500
                                                   2,534
                                                  17,558
                                                   4.637
                                                   2. ISO
                                                   4.884
                                                     N/A
                                                  21.251
                                                   1.873
                                                     690
                                                                     ii
                                                                     33 32X
                                                                     27 MX
                                                                     S:SS
                                                                        N/A
                                                                     7B.83X
                                                                        N/A
                                                                        N/A
                                                                        N/A
                                                                        N/A
                                                                        N/A
                                                                        N/A
                                                                     38.48X
                                                                     38.90X
                                                                     1B.36X
                                                                        N/A
                                                                        N/A
                                                                        N/A
                                                                     21.42X
                                                                        N/A
                                                                     48.00X
                                                                        N/A
„ worn Export. . Export, to U.S. Sources,
i
   0
 186
   2
     0
12.295
   105
217
57
0
0
0
0
1
0
23318
799
1
768
0
0
0
1831
0
0
0
616,955
9,391
0
0
0
4
2
1
3,671.601
173,191
3,620
1,051.654
4
3
0
149.147
0
3
0
                                                                                                                 AUTOMOBILE
                                                                                                               MARKET SHARE OF

O.OOX
1.64X
0-04X
                           2.96X
                           0.08X
                           O.OOX
                           O.OOX
                           O.OOX
                           O.OOX
                           0.06X
                           O.OOX
                          2B.97X
                           5.92X
                           0.03X
                           4.S8X
                           0.01X
                           O.OOX
                           O.OOX
                           N/A
                           O.OOX
                           O.OOX
                           O.OOX
                                                                                           33 *'
                                         Canada: U.S. Department of Conmerce
                                         Japan: Japanese Enfcassy Cable
                                         Korea: Bank of Korea
                                         Malaysia S Sinagapore: U.S. Department of Connerce
                                         Taiwan: U.S. Department of Conmerce, Bureau of the tf"iU9.ui-ui . v.   < n
                                         Bureau of the Census, U.S. Department of Conraeree, 1987. "Highlight, of U,
2) Source: Department of Conmerce.  1986. "United States General Imports and Imports for Consumption". Washington D.C.,


   TOTAL WORLD EXPORTS = Total t Value of all product exports for the selected country.
   TOTAL EXPORTS TO U?S. - Total S Value of all export, to the U.S. for the selected country.
   iT SHARE OF COUNTRY EXPORT MARKET • TOTAL EXPORTS TO U.S./TOTAL UORLD EXPORTS
   MARKET SHARE OF EXPORTS TO U.S. • S Value of Product/ $ Value of TOTAL EXPORTS TO U.S.
   MARKET SHARE OF WORLD EXPORTS = S Value of Product/ S Value of TOTAL WORLD EXPORTS
   TOTAL PRODUCTION ' » Value of product manufactured in the selected country.
   PRODUCTION SHARE EXPORTED TO U.S. " S Value of Product exported to U.S./ TOTAL PRODUCTION
  AUTOMOBILE
MARKET SHARE OF
WORLD EXPORTS

    1.47X
    0.76X
    O.OOX
    0.60X
    7.99X
    0.01X
    O.OOX
    0.46X
    0.01X
    O.OOX
    O.OOX
    1.51X

      N/A
    0.07X
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
    11.15X
    2.30X
    0.01X
      N/A
      N/A
      N/A
    O.OOX
      N/A
    O.OOX
      N/A
      N/A
 AUTOMOBILE
   TOTAL
PRODUCTION
     S
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A

    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
                                                                                                               S.  Export and Import Trade". Washington. D.C.
PRODUCTION SHARE
EXPORTED TO U.S.

      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A

      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A
      N/A

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                                                                            ATTACHMENT  K-4


                                                                                 EXHIBIT  4

                                        U.S.  MARKET  FOR  SELECTED  CFC-RELATED  EXPORTS:    ELECTRONICS
                                                                                      TOTAL EXPORTS OF
                                                                                         ELECTRONICS
                                                             U.S. SHARE OF COUNTRY'S        TO U.S.
                                                             TOTAL EXPORT MARKET    (S Millions)  (Quantity (MT»
                                                                    25.60X                	
                                                                    25.46X
                                                                    11.22X
                                                                    23.18X
                                                                    24.17X
                                                                    24.72X
                                                                    33.32X
                                                                    27.B8X
                                                                    24.60X
                                                                    30.61X
                                                                    32.78X
                                                                    32.33X

                                                                       N/A
                                                                    78.83X
                                                                       N/A
                                                                       N/A
                                                                       N/A
                                                                       N/A
                                                                       N/A
                                                                       N/A
                                                                    3B.4BX
                                                                    3B.90X
                                                                    18.36X
                                                                       N/A
                                                                       N/A
                                                                       N/A
                                                                    21.42X
                                                                       N/A
                                                                    48.00X
                                                                       N/A
                                                                       N/A

1) World Exports I Exports to U.S. Sources: EEC: {Data for Dec.- Nov. 1986} EEC Trade Statistics Book  2. 1986; and
                                          Bureau of the Census, U.S. Department of Commerce, 1987
                                        Canada: U.S. Department of Conmerce
                                        Japan: Japanese Embassy Cable
                                        Korea: Bank of Korea
                                        Malaysia & Sinagapore: U.S. Department of Commerce
                                        Taiwan: U.S. Department of Conmerce. Bureau of the Census
                                        Bureau of the Census, U.S. Department of Conmerce, 1987. "Highlights of  U.S. Export and Import Trade". Washington, D.C.
2) Source: "Tariff Schedule of the United States, Annotated, (TUSA), Department of Conmerce, 1986.
4) Source: "Electronics Foriegn Trade", Electronics Industry Association (EIA), Marketing Services Department, p. 20.

   Additional Notes:
   TOTAL WORLD EXPORTS = Total $ Value of all product exports for the selected country.
   TOTAL EXPORTS TO U.S. « Total t Value of all exports to the U.S. for the selected country.
   U.S. SHARE OF COUNTRY EXPORT MARKET • TOTAL EXPORTS TO U.S./TOTAL UORLD EXPORTS
   MARKET SHARE OF EXPORTS TO U.S. = S Value of Product/ $ Value of TOTAL EXPORTS TO U.S.
   MARKET SHARE OF WORLD EXPORTS = S Value of Product/ » Value of TOTAL UORLD EXPORTS
   TOTAL PRODUCTION = t Value of product manufacture in the selected country.
   PRODUCTION SHARE EXPORTED TO U.S. = f Value of Product exported to U.S./ TOTAL PRODUCTION
COUNTRY

EEC
Be 1 g i in- Luxembourg
Denmark
France
Germany
Greece
Ireland
Italy
Netherlands
Portugal
Spain
United Kingdom
Brazil
Canada
China
Egypt
Honduras
Hong Kong
India
Indonesia
Japan
Korea
Malaysia
Hex i co
Norway
Phlllpines
Singapore
Sweden
Taiwan
Thailand
Turkey
TOTAL UORLD EXPORTS
(S Millions)
310,660
16. 4M
16,660
45,668
108,094
1,764
3,136
40,572
17,738
1,960
9,016
49,588
N/A
87. 145
N/A
N/A
N/A
N/A
N/A
N/A
209,200
34,700
13.800
N/A
N/A
N/A
22,800
N/A
44,272
N/A
N/A
TOTAL EXPORTS TO U.S
(S Millions)
79,516
4.191
1,869
10.586
26, 128
436
1,045
11.311
4,363
600
2,955
16,032
7,340
68,700
5,241
123
486
944
2,465
3,675
80,500
13,500
2,534
17,558
4,637
2,150
4,684
1170
21,251
1,873
690
2740
N/A
N/A
N/A
1637
N/A
N/A
N/A
N/A
N/A
N/A
1103
N/A
2281
N/A
N/A
N/A
N/A
N/A
N/A
22197
2701
310
2563
N/A
N/A
2335
N/A
3649
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
ELECTRONICS
MARKET SHARE OF
EXPORTS TO U.S.

N/A
N/A
N/A
N/A
6.26X
N/A
N/A
N/A
N/A
N/A
N/A
6.B8X
N/A
3.32X
N/A
N/A
N/A
N/A
N/A
N/A
27.571
20.01X
12.24X
14.60X
N/A
N/A
47.B2X
N/A
17.17X
N/A
N/A
ELECTRONICS
MARKET SHARE OF
UORLD EXPORTS

N/A
N/A
N/A
N/A
1.51X
N/A
N/A
N/A
N/A
N/A
N/A
2.23X
N/A
2.62X
N/A
N/A
N/A
N/A
N/A
N/A
10.61X
7.78X
2.25X
N/A
N/A
N/A
10.24X
N/A
8.24X
N/A
N/A
ELECTRONICS
TOTAL
PRODUCTION
S
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A

PRODUCTION SHARE
EXPORTED TO U.S.

N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
 I
en

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                                                                                 ATTACHMENT  K-4

                                                                                      EXHIBIT 5

                                           U.S.  MARKET  FOR  SELECTED  CFC-RELATED EXPORTS:    REFRIGERATION
     COUNTRY

EEC
  Bel g i uo- Luxembourg
  Demark
  France
  Germany
  Greece
  Ireland
  Italy
  Netherlands
  Portugal
  Spain
  United Kingdom

Brazil
Canada
China
Egypt
Honduras
Hong Kong
India
Indonesia
Japan
Korea
Malaysia
Mexico
NorMy
Phillpines

1
TOTAL UORLO EXPORTS
(S Millions)
310.660
14,464
16.660
45.668
108.094
1.764
3.136
40.572
17.738
1.960
9,016
49.588

1
TOTAL EXPORTS TO U.S.
{* Millions)
79.516
4.191
1.869
10.586
26,128
436
1.045
11.311
4,363
600
2,955
16,032


U.S. SHARE OF COUNTRY'S
TOTAL EXPORT MARKET (S
25.60X
25.46X
11.22X
23.18X
24.17X
24.72X
33.32X
27.88X
24.60X
30.61X
32.78X
32.33X
TOTAL EXPORTS OF
REFRIGERATION EQP.
TO U.S.
Millions) (Units)
53 252.894
1 3.844
3 4.220
1 7.720
8 19,966
0 1
0 16
31 175.580
1 1.454
2 16.132
2 8.176
5 15.785
Taiwan
Thailand
Turkey
    N/A
 87,145
    N/A
    N/A
    N/A
    N/A
    N/A
    N/A
209,200
 34,700
 13,800
    N/A
    N/A
    N/A
 22.800
    N/A
 44,272
    N/A
    N/A
 7.340
68,700
 5,241
   123
   486
   944
 2,465
 3,675
80,500
13.500
 2,534
17.558
 4.637
 2.150
 4.884
   N/A
21.251
 1.873
   690
   N/A
78.83X
   N/A
   N/A
   N/A
   N/A
   N/A
   N/A
38.48X
38.90X
18.36X
   N/A
   N/A
   N/A
21.42X
   N/A
48.00X
   N/A
   N/A
 6
40
 0
 0
 0
 0
 0
 0
40
46
 0
15
 0
 3
 0
39
 2
 0
 1
 38.075
155.352
     90
      0
      0
    596
      0
      0
214.699
 57.161
      0
193.030
      0
 12.200
    155
 82,662
 20,664
      0
  1.051
 REFRIGERATION
MARKET  SHARE OF
EXPORTS TO U.S.

     0.07X
     0.02X
     0.1BX
     0.01X
     0.03X
     O.OOX
     O.OOX
     0.28X
     0.02X
     0.32X
     0.05X
     0.03X

     O.OBX
     0.06X
     O.OOX
     O.OOX
     O.OOX
     0.01X
     O.OOX
     O.OOX
     0.05X
     0.34X
     O.OOX
     0.08X
     O.OOX
     0.15X
     O.OOX
     N/A
     0.01X
     O.OOX
     0.08X
REFRIGERATION
MARKET SHARE OF
UORLD EXPORTS

    0.02X
    O.OOX
    0.02X
    O.OOX
    0.01X
    O.OOX
    O.OOX
    0.08X
    O.OOX
    0.10X
    0.02X
    0.01X

      N/A
    0.05X
      M/A
      N/A
      N/A
      N/A
      N/A
      N/A
    0.02X
    0.13X
    O.OOX
      N/A
      N/A
      N/A
    O.OOX
      N/A
    O.OOX
      N/A
      N/A
                                                                                                                         REFRIGERATION
                                                                                                                             TOTAL     PRODUCTION SHARE
                                                                                                                          PRODUCTION   EXPORTED TO U.S.
                                                                                                                               t
                                                                                                                              N/A           N/A
                                                                                                                              N/A           N/A
                                                                                                                              N/A           N/A
                                                                                                                              N/A           N/A
                                                                                                                              N/A           N/A
                                                                                                                              N/A           N/A
                                                                                                                              N/A           N/A
                                                                                                                              N/A           N/A
                                                                                                                              N/A           N/A
                                                                                                                              N/A           N/A
                                                                                                                              N/A           N/A
                                                                                                                              N/A           N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
      1) World Exports t Exports to U.S. Sources: EEC:  (Data for Dec.-  Nov. 1986) EEC Trade Statistics Book  2.  1986; and
                                                 Bureau of the Census. U.S. Department of Commerce, 1987
                                               Canada: U.S. Department of Commerce
                                               Japan: Japanese Embassy Cable
                                               Korea: Bank of Korea
                                               Malaysia I Sinagapore: U.S. Department of Coomeree
                                               Taiwan: U.S. Department of Commerce. Bureau of the Census
                                               Bureau of the Census. U.S. Department of Conroerce. 1987. "Highlights of U.S.  Export and Import Trade". Washington, D.C.
      2) Source: Department of Comerce. 1986. "United States General Imports and Imports for Consunptlon".  Washington O.C..

        Additional Notes:
        TOTAL WORLD EXPORTS = To.tal % Value of all product exports for the selected country.
        TOTAL EXPORTS TO U.S. = Total % Value of all exports to the U.S. for the selected country.
        U.S. SHARE OF COUNTRY EXPORT MARKET » TOTAL EXPORTS TO U.S./TOTAL UORLD EXPORTS
        MARKET SHARE OF EXPORTS TO U.S. = 9 Value of Product/ S Value  of TOTAL EXPORTS TO U.S.
        MARKET SHARE OF WORLD EXPORTS = f Value of Product/ % Value of TOTAL WORLD EXPORTS
        TOTAL PRODUCTION - t Value of product manufactured in the selected country.
        PRODUCTION SHARE EXPORTED TO U.S. • % Value of Product exported to U.S./ TOTAL PRODUCTION
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A

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                                                                                  ATTACHMENT K-4

                                                                                       EXHIBIT  6

                                           U.S.  MARKET  FOR  SELECTED  CFC-RELATED  EXPORTS:    FOAM  PRODUCTS
      COUNTRY

EEC
  Belgium-Luxembourg
  Denmark
  France
  Germany
  Greece
  Ireland
  Italy
  Netherlands
  Portugal
  Spain
  United Kingdom

Brazil
Canada
China
Honduras
Hong Kong
India
Indonesia
Japan
Korea
Malaysia
Mexico
Norway
Phillpines
Singapore
Sweden
Taiwan
Thailand
Turkey
                 1
TOTAL WORLD EXPORTS
   ($ Millions)
         310,660
          16,464
          16,660
          45,668
         108,094
           1.764
           3,136
          40.572
          17,738
           1.960
           9.016
          49.588

             N/A
          87,145
             N/A
             N/A
             N/A
             N/A
             N/A
             N/A
         209,200
          34,700
          13,800
             N/A
             N/A
             N/A
          22.800
             N/A
          44,272
             N/A
             N/A
TOTAL EXPORTS TO U.S.
    ($ Millions)
            79.516
             4.191
             1.869
            10.586
            26.128
               436
             1.045
            11,311
             4.363
               600
             2,955
            16.032

             7.340
            68,700
             5,241
               123
               486
               944
             2,465
             3,675
            80,500
            13,500
             2,534
            17,558
             4,637
             2,150
             4,884
               N/A
            21,251
             1,873
               690
                          TOTAL  EXPORTS OF           FOAM PRODUCT
                            FOAM PRODUCTS           MARKET SHARE OF
U.S. SHARE OF COUNTRY'S        TO U.S.               EXPORTS TO U.S.
TOTAL EXPORT MARKET    It Millions) (Quantity 
      1) World Exports C Exports to U.S.  Sources: EEC: 
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                                  APPENDIX L

                        REGULATORY FLEXIBILITY ANALYSIS
    The Regulatory Flexibility Act requires all Federal Agencies to analyze the
effects of their regulations on small entities and to involve these entities in
the development of regulations.  The Act's purpose is to encourage agencies to
minimize the effects of regulations on small entities to the extent possible
without compromising the intent of the statute for which the regulation is being
written.

    The EPA is currently considering increased regulation of the use of
chlorofluorocarbons (CFCs) and halons due to their potentially damaging effects
on stratospheric ozone.  A complete description of the reasons why EPA is
considering this action and the legal basis for it can be found in Chapters 2
and 3 of Volume I of this Regulatory Impact Analysis (RIA).

    This appendix provides an initial assessment of the potential economic
impact on small entities of the proposed regulations.  Its organization closely
follows the outline suggested by the Guidelines for Implementing the Regulatory
Flexibility Act published by EPA (henceforth the EPA Guidelines).  Its major
sections are as follows:

        •   Identification of Alternatives.  Each of the regulatory
            alternatives discussed in Chapter 11 of Volume I of the RIA
            is briefly summarized and its administrative costs are
            estimated.

        •   Demographic Analysis.  This section defines the relevant
            universe and presents the criteria to determine whether
            small businesses are disadvantaged by the regulatory action.
            It describes the industries currently using CFCs intensively
            and presents the reasons why the foam-blowing industries are
            the most likely group affected.

        •   Cost Analysis.  The methodology used to estimate production
            and compliance costs is presented.  Because only limited
            information is available about the financial characteristics
            of the industries most likely to be affected by CFC
            regulation, this methodology uses a number of assumptions to
            convert available data into estimates of the financial
            characteristics of small foam-blowing businesses.  These
            estimates are constructed to conform as closely as possible
            to existing EPA guidelines on performing regulatory
            flexibility analyses.

        •   Competitive Effects Analysis.   An assessment of the effect
            of the proposed regulatory action on the foam-blowing
            industry is presented.   Included in the assessment are
            estimates of a range of numbers of industrial facilities
            that might go out of business because of the possible

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                                      L-2

            regulations and the size of cost increases faced by the
            remaining facilities in the industries.

        *   Exemptions and Allowances.   The advantages and disadvantages
            of methods of providing special treatment for the foam
            blowing industry are considered.

        •   Summary.  A synopsis of major findings is presented.

1.  IDENTIFICATION OF ALTERNATIVES

    This section provides an overview of the five regulatory alternatives
examined in this RIA.  These alternatives are designed to achieve the regulatory
goal of a freeze at 1986 production levels in 1989, reductions to 80 percent of
that level in 1993, and reductions to 50 percent of that level in 1999.  The
analysis has not attempted to examine the impacts of alternative stringency and
coverage options (Chapter 5 of this RIA) on small businesses.

1.1  Description of Alternatives

    The Regulatory Flexibility Act requires EPA to identify several regulatory
options which attempt to minimize the economic impacts, both market-related and
administrative, on small businesses.  EPA has identified five possible
regulatory options.  They are discussed in greater detail in Chapter 11 of the
RIA document.  The following are brief descriptions of these five regulatory
options.

        •   Auctioned Rights:  An auctioned rights system would control
            CFCs by requiring permits for the production of these
            chemicals.  Companies seeking to use CFCs would have several
            options.  They could either purchase rights at a periodic
            auction held by EPA, acquire them from other firms who had
            purchased them at an auction, or buy CFCs through their
            current supply channels that already have purchased rights.
            Under the last option, CFC producers, wholesalers, or
            processors would acquire rights, eliminating the need for
            the majority of small firms using CFCs to obtain rights
            themselves.  Thus, CFC users could purchase rights and CFCs
            separately or could avoid the need for rights altogether if
            their supplier has previously purchased rights in sufficient
            quantities to cover their sales.  Over time, increasing
            demand for CFCs in conjunction with a limit on the number of
            CFC rights in order to meet regulatory targets will result
            in an increase in the price of rights.  Price increases will
            provide an incentive for firms with relatively inexpensive
            options to reduce their CFC consumption through low-cost
            substitutes, CFC recycling or controls, and/or new
            production technologies.

        •   Allocated Quotas:  An allocated quota system would directly
            control CFCs by setting limits on, and requiring permits
            for, the production and importation of CFCs.  The allowable
            level of CFCs (set by the regulatory target) would be
            allocated among current CFC producers and importers based on

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                              L-3

    their historic market share.   Allocation limits together with
    growing demands for CFG products would result in higher prices,
    providing an incentive for CFG users to reduce their consumption
    through lower-cost substitutes,  CFG recycling, and/or new production
    technologies.   Only the few CFC producers and importers would
    require permits.

•   Regulatory Fees;   A regulatory fee system would control CFC
    emissions by imposing a fee per unit of CFC production or
    importation.   Because CFC users would pay the cost of CFCs '
    plus a set fee, this fee would increase the cost of products
    containing or produced with CFCs and provide an incentive to
    consumers to reduce their CFC use through lower-cost product
    substitutions, CFC recycling, and/or new production
    technologies.   The fee would be modified over time,  as
    necessary,  to ensure the regulatory target is met.  Fees
    would be collected directly from CFC producers.

•   Engineering Controls/Bans:   A more traditional regulatory
    system for controlling CFCs would include the issuance of
    process or engineering control restrictions, product bans,
    or other forms of regulation aimed at directly reducing CFC
    use in particular industrial categories.   An initial list of
    regulated uses would be issued to achieve a specified
    control goal (e.g., a freeze or 20 percent reduction).  This
    list could be expanded over time if CFC use in non-regulated
    areas continued to grow or if additional reductions were
    required as part of a phase-down.  In contrast to the three
    economic incentive-based approaches discussed above, in
    which firms would have a choice of preferred CFC reduction
    strategies, EPA would select specific control targets under •
    this approach to regulation.

•   Hybrid Options:  Direct regulatory and economic incentive
    approaches each have their strengths and weaknesses.
    Different combinations of the two approaches are possible
    and potentially attractive.  One such hybrid approach would
    involve regulating specific uses of CFCs (i.e., through
    engineering controls and CFC use bans and reductions) along
    with setting a production cap.   The specific targeted
    requirements would ensure reductions occurred in those uses
    where low cost options are clearly available.  The allocated
    quota system would provide a ceiling to ensure that the
    regulatory goal is achieved (e.g.,  a freeze or 20%
    reduction)  and would rely on price incentives to guard
    against increased CFC use in areas not subject to specific
    restrictions.   Another hybrid would combine allocated quotas
    with regulatory fees.   The use of quota restrictions ensure
    the regulatory goal is met.  The use of regulatory fees
    would reduce the level of transfer payments received by
    producers and increase incentives for the development of
    alternative chemicals to substitute for CFCs.

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                                      L-4

1.2  Discussion of Market and Administrative Costs of Alternatives

   - The first three options -- Auctioned Rights, Allocated Quotas, and
Regulatory Fees -- are based on similar economic approaches, and achieve a
regulatory goal by providing price incentives for firms to reduce CFC
consumption.  Since all three options produce similar CFC price increases for
equal levels of CFC reductions, the market effects on an .industry or user group
are equal across these three options.

    For the Engineering Control/Bans option, the market effects may not' be
comparable to the other options.  If a specific industry group is not targeted
for direct regulation, the industry will not be affected.  If direct regulation
does apply, it is likely that market effects caused by increases in production
cost from controls will be equal to or greater than market effects caused by
other options.

    Under the Hybrid options, the imposition of allocated quotas will increase
CFC prices to user groups.  Market effects would be similar to those produced by
the other economic incentive approaches (Auctioned Rights, Allocated Quotas, and
Regulatory Fees) if all users with low cost CFC reduction measures implement
them.  If some industries with low cost control options available do not
implement them, selected controls directed at specific CFC using industries
would limit the demand for CFCs from these industries.  Limiting CFC consumption
among selected user groups reduces the CFC price rise to all user groups, and
will mitigate market effects for industries sensitive to price increases.

    The administrative costs to CFC user groups are different across the five
options.  A detailed analysis of the administrative burden for these five
options is presented in Appendix M.  In general,'the three economic incentive
options -- Auctioned Rights, Allocated Quotas, and Regulatory Fees -- result in
lower administrative costs for user groups.  Administrative costs, however, fall
primarily on the user groups whenever Engineering Controls/Bans, either by
themselves or in association with other regulatory options, are used.

    Two options -- Allocated Quotas and Regulatory Fees -- impose insignificant
administrative costs to the user groups.  Because these options place the entire
administrative burden on the 7 CFC and halon producers and 14 importers, user
groups are not affected by reporting or compliance costs.  Thus administrative
costs for user groups, and therefore small businesses, would be negligible.

    Auctioned Rights may entail limited administrative costs for user groups.
The Auctioned Rights option allows users to participate in the auction for
rights.  Preparation for the auction will entail costs as firms decide on
bidding price and perform market analysis.  If user firms win the auction,
additional functions such as the trading of rights will also entail
administrative costs.

    The Engineering Controls/Bans option presents the largest administrative
costs, requiring controls or bans and product substitutes for various user
groups.  EPA will require these firms to develop compliance plans (where
appropriate), submit compliance reports and monitor results.  An analysis of
these administrative costs is described in Appendix M of Volume II.  The
administrative burdens for small businesses would be greater under this option
than under the economic incentive approach.

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                                      L-5

    In summary, EPA expects similar market effects through Auctioned Rights,
Allocated Quotas, and Regulatory Fees.  The CFC price rise due to these options
is likely to affect a user group similarly.  Engineering Controls or Bans will
more significantly affect those groups targeted for regulation.  For
administrative costs, EPA expects these costs for user groups to be negligible
for Allocated Quotas and Regulatory Fees, minor for Auctioned Rights and
substantial for. the Engineering Controls/Ban option.  The cost of any hybrid
option, including the use of engineering controls and bans, would also entail
substantial administrative costs.

2.  DEMOGRAPHIC ANALYSIS

    This section explains how the analysis established criteria for the
industries affected by the regulations, for what constitutes a small business
within these industries.

2.1  Industry Definition

    The number of commercial and industrial facilities potentially affected by
CFC regulations is extremely large.*•  These regulations could impact every
hospital, every service station repairing mobile air conditioners and every
grocery store in the United States.  Due to the large number, not all of these
establishments could be examined in depth.  Instead, this analysis selected
those CFC-using industries for which regulation was most likely to present
serious economic problems.

    The major CFC and halon consuming industries are:  the refrigeration/air
conditioning industries, the fire extinguishing industry, the hospital industry,
the electronics industry, and the foam blowing industries.  A major criterion in
examining the potential impact of CFC regulation on an industry was the share
which CFCs represented of total production costs of the industry.  We assumed
that if the industry as a whole had CFC costs that were less than five percent
of the costs of the product or service provided by the industry, then the
economic impact of the proposed regulations was not likely to be significant and
the industry did not need to be studied in depth.  The refrigeration industry
was eliminated on this basis.

    The fire extinguishing industry was eliminated after discussions with the
engineering contractors.  Because fire extinguisher sales are driven by local
zoning ordinances and other legal requirements and because the sales are a
function of the purchaser's desire to have a fire safe residence or workplace,
we concluded that sales would change insignificantly even if halon prices rose
substantially.   Furthermore, the costs of fire extinguishers in most uses are an
insignificant component of the total cost of providing the service of which the
     1 See Appendix M for a more complete discussion of these costs.


     2 Although the Regulatory Flexibility Act refers to effects on small
entities, in general, this analysis will examine the effects on small businesses
only.  Effects of CFC regulations on small governments and small non-profit
institutions are expected to be minimal.

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                                      L-6

fire extinguisher was a part.  Examples here include fire extinguishing systems
in commercial buildings or fire protection systems built into military aircraft.

    Data estimating CFC costs as a percent of total production cost^s are
difficult to obtain for both the solvent and sterilization industries.  Solvent
applications are ubiquitous in the American workplace.  A review of solvent
applications identified over 200 industries (identified at the 4-digit SIC
level) using some type of CFC solvent cleaning processes.  Given the range of
products covered, no meaningful estimate of CFC cost shares could be derived.
Furthermore, the range of applications makes it difficult to define a repre-
sentative industry which'would be analyzed as part of a regulatory flexibility
analysis.  Moreover, given the relatively high cost of electronic components, it
is likely that CFC based solvents are a small percentage of total cost within
the electronics industry.

    The use of CFCs as sterilants is more clearly defined but no less difficult
to analyze than the use of CFCs as solvents.  The capital equipment required for
sterilization is relatively inexpensive and its use has spread widely through
museums, libraries, and hospitals.  For both sterilants and solvents, price
increases are not likely to have substantial impacts on these industries,
because of the high value of their services.  Therefore, the sterilant and
solvent industries were eliminated from consideration.

    The final category is the foam-blowing industry.  CFCs comprise about eight
percent of the total cost of foam production.  CFCs are an important part of the
costs of most foams, and costs incurred by these producers could significantly
affect smaller participants in these industries.  Thus, this industry was
selected for more intensive study in the remainder of this analysis.

2.2  Analysis of the Foam Industry

    It is difficult to characterize the businesses involved in foam-blowing.
Foam-blowing facilities are distributed across several Standard Industrial Codes
(SICs) and those SICs including foam-blowing facilities also contain several
other types of industries.  For example, flexible polyurethane companies have
different SIC codes such as 3069 (fabricated rubber), 2821 (plastic materials
and resins), or 3079 (miscellaneous plastics).  The miscellaneous plastics SIC
classification includes facilities that produce plastic molding, plastic film
and sheet, plastic piping, and plastic bottles, as well as facilities that
produce foam products.

    Without comprehensive information on foam-blowing facilities, we used
several sources to characterize the foam blowing industry, including lists of
foam-blowing facilities compiled by engineering contractors, information
submitted by trade associations, and lists of facilities submitted by industry
officials.  We reviewed available sources of financial data (most frequently the
Trinet business data base) to obtain information about sales, employment and
principal manufacturing for identified facilities.

     We were unable to obtain useful financial data for some of the businesses
on the engineering contractors' lists.  Although some of these failures may be
attributable to discrepancies in company name or location between the
contractor's list and the Trinet data base, or mergers into other companies, it
is more likely that many of the businesses on the list have less than twenty
employees and are not captured by the Trinet data base.  We were able to obtain

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                                      L-7

financial information for a total of 196 foam blowing facilities.  Despite its
limitations, this sample provided the best available means of assessing the
number of small facilities operating in the foam-bloving industry.  Information
received through public comment was also incorporated in the analyses.

    With this information, we were able to make general assessments of the
number of small facilities (i.e., those with less than 500 employees-*) in
different foam-blowing sectors.  Most of the information gathered about the foam
industry pertained to foam-blowing facilities, not businesses.  Where possible,
we indicate how many of these facilities are components of large firms and thus
not small businesses under the EPA and SBA criteria.

    We divided the foam blowing industry into three general sectors based on the
type of foam produced and its use.  These three sectors include flexible foam,
rigid packaging foam, and rigid insulating foam.  Because rigid insulating foam
is produced in different forms, by different types of producers, it was further
divided into three categories:  rigid insulating foam--poured, rigid insulating
foam--boardstock, rigid insulating foam--sprayed.  Descriptions of these sectors
follow:

        (1)  Flexible Foam:  Includes molded flexible polyurethane foam
             used in automobile seat cushions and backs, and other
             products; and slabstock flexible polyurethane foam used for
             furniture cushions, carpet underlay, and'bedding.  The
             flexible foam industry is made up of approximately 90
             percent small facilities and 10 percent large.  The large
             facilities often do not produce foam products exclusively,
             but are producers of products that use foam, such as
             furniture or car companies.

        (2)  Rigid Packaging Foam:  Includes extruded polystyrene sheet foam,
             polyproplene foam, rigid polyurethane foam, and polyethylene foam.
             These foams are used in everyday disposable products such as carry-
             out containers, egg cartons; disposable plates, cups, bowls; and
             packaging materials.  Small facilities comprise almost all of the
             rigid packaging foam industry.

        (3)  Rigid Insulating Foam--Poured:  Includes poured polyurethane foam,
             a common insulation used to fill walls of refrigerators, freezers,
             refrigerated tanks, railcars, and the walls of buildings and door
             cavities.  Small facilities comprise almost all of the rigid
             insulating foam--poured industry.
     •* The EPA Guidelines recommend that, in general, the Small Business
Administration (SBA) definitions of a small business be used in determining the
number of small and large businesses (unless very good reasons exist to use
other definitions).  The SBA definitions as published in 13 CFR 121 are based on
SIC classifications.  Because foam-blowing businesses are spread across several
SIC classifications, the size criteria varies.  The criteria range from 500 to
1,000 employees,  with 500 employees the most frequently used criteria and the
one used to define small businesses in this analysis.

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                                      L-8

        (4)  Rigid Insulating Foam- -Boaxdstock:  Includes rigid polyurethane --
             both boardstock and laminated, extruded polystyrene boardstock, and
             phenolic foam.  These foams are all used as building insulation.
             While most facilities in this sector are small, they are often part
             of a larger business.

         (5) Rigid Insulating Foam--Sprayed:  Includes rigid sprayed
             polyurethane foam typically used as rigid thermal insulation after
             construction has been completed.  The rigid insulating foam-sprayed
             industry is comprised of two types of businesses.  Based oh
             estimates from trade associations, there are approximately 14 spray
             foam system supplier companies that are predominantly medium sized
             businesses (i.e., 50-500 employees).  These businesses supply
             several hundred small (usually having less than 10 employees) spray
             foam applicator companies.

3.  COST ANALYSIS

      This section presents the EPA definitions of a significant economic impact
and the methodology used to apply these criteria.  The core of this methodology
is the integration of quantitative financial profiles of affected facilities
with the results of the cost analyses presented in Chapter 9 of this final RIA.

3.1  Definition of Significant Impact

    The EPA Guidelines are clear as to what constitutes a significant economic
impact.  The criteria, any one of which results in a significant economic impact
and therefore the need for a full regulatory flexibility analysis, are:

        1.   annual compliance costs increase total costs of production
            for small entities by more than 5 percent;

        2.   compliance costs as a percent of sales for small entities
            are at least 10 percent higher than compliance costs as a
            percent of sales for large entities;

        3.   capital costs of compliance represent a significant portion
            of capital available to small entities, considering internal
            cash flow plus external financing capabilities; or

        4.   closures of small entities are likely.

    The implementation of the first three criteria was conducted by comparing
compliance costs to the financial data of a model facility.  For each facility
in our sample of facilities provided by contractors we used the Trinet data base
to determine the facility's SIC code, employment, and sales.  Based on these
figures a "model" facility was chosen to represent each foam-blowing sector
identified above.4  When choosing this model facility, we took into
consideration that our lists of facilities overrepresented the larger facilities
     4 Both a large and small model facility was chosen for the flexible foam
segment.

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                                      L-9

in the industry, and therefore selected a smaller than average facility on our
list.  This model facility was then used to examine the likely impacts of the
regulations.  For the fourth criteria, we estimated the probable extent of
facility closures by examining the probable loss in the size of each foam market
due to the switch to product substitutes.

3.2  Production Costs and Internal Cash Flow

    Some of the financial data on each model facility necessary to apply the
criteria was gathered directly from the Trinet data base.  However, data on
production costs and internal cash flow for facilities in the foam-blowing
industry are not directly obtainable.  As proxies for these data, we estimated
the production costs of the model facility as sales minus profits before taxes
and internal cash flow as profits after taxes plus depreciation.  To estimate
profits and depreciation, Robert Morris Associates^ (RMA) financial data on
representative industry ratios for Return-on-Sales and Depreciation-to-Sales
were used.  These data are organized by SIC codes and by size measured as sales
for industrial facilities and industry participants.

    As an example of how the financial characteristics of a model facility were
estimated, consider a hypothetical polyurethane foam producer, the ABC
Corporation.  By matching this corporation's name and location (as determined by
the engineering contractors in their survey of foam producing facilities) to the
Trinet database, we determined the SIC code of the ABC Corporation, in this
case, it is likely to be Code 3079 for "miscellaneous plastic products."  The
ABC Corporation's employment and the sales volume, are 150 employees and $15
million.  The RMA data provided information on the return on sales rate for
other plastics manufacturers with sales between $10 and $50 million.  This
enabled us to convert sales data to an estimated profit of say $600,000.  A
depreciation estimate was obtained using RMA data in a similar fashion.

3.3  Estimating Compliance Costs

    To compute the annual compliance costs, necessary for the application of the
first three criteria, we estimated three types of costs that industrial
facilities will incur and then combined them in a consistent annualized manner.
All compliance costs included in this analysis are increases in production
costs.  Administrative costs were not included because they would be imposed on
user industries only under one of the market-based regulatory options discussed
in Appendix M -- auctioned rights-- and even in that option, would be relatively
small.  However, the use of any engineering controls or bans as regulatory
     5 RMA 1986 Annual Statement Studies. Robert Morris Associates, 1986.
Because companies' fiscal years end at different times and because there is
often a long lead time between the reporting of results and their entry into
these two information systems, we feel it reasonable to compare these numbers to
compliance cost estimates measured in 1985 dollars.

     " In cases where a particular SIC code was not included in the RMA data,
return on sales and depreciation to sales ratios were extracted for the four
digit SIC code which most nearly corresponded to the primary activity of the
facility in question.

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                                      L-10
options would entail significant administrative costs and necessitate a revision
to the analysis presented below.

    The three types of compliance costs estimated here include^:

        1.  the higher prices for CFCs which occur due to regulations;

        2.  the cost of switching to an alternative input to the production
            process; and

        3.  the cost of installing new production equipment or undertaking
            additional maintenance in a production facility to reduce CFG use.

    To estimate the compliance cost of higher CFC prices, annual CFG use was
multiplied by the estimated change in CFC prices to obtain an annual incremental
cost of CFC use.  The cost of switching to an alternative input to the
production process will be incurred by industries that pay a higher price for a
substitute blowing agent.  This cost was estimated as the dollar costs of the
new input per pound of output less the cost of the CFC per pound of output and
multiplying this difference by the amount of output per year.  As presented in
Appendix I, standard amortizing techniques were used to estimate the annual
compliance costs associated with installing new production equipment or
undertaking additional maintenance in a production facility.

    Because the capital costs, operating and maintenance costs, and increased
CFC prices are estimated as totals for the industry, they must be allocated to
each segment's model facility for the regulatory flexibility analysis to be
completed.8  Based on current prices of CFCs, and an estimate of the percentage
cost of CFCs in each foam-blowing segment's production, each model facility's
sales were used to determine the amount of CFCs used by the facility.  This
amount was divided by the total amount of CFCs used by the model facility's
segment to determine the facility's percentage of CFC use for the segment.9
This percentage was multiplied by the segment's total compliance costs to
determine the facility's share of compliance costs.^
     ' These costs are generated by the Integrated Assessment Model (IAM) and
provided as input in the form of aggregate (1) capital costs, (2) operating and
maintenance costs, and (3) costs due to CFC price increases for the industry
overall (see Appendix I).   These cost estimates generated by the IAM are
directly derived from extensive cost research by engineering firms (see Volume
III of the RIA document).
     p
     0 The most important assumption implicit in this portion of the analysis is
that the production processes used by all facilities in an industry will be the
same.

     * The cost per metric ton of foam for each "industry" is a weighted average
of the cost per metric ton estimated for each use-application category of the IAM.

     *•" This method has the added virtue of normalizing our total "industry"
cost on the same basis as that of the IAM.  As discussed previously,  we were
unable to obtain data on all of the facilities included in the engineering
contractors' analyses.

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                                      L-ll
3.4- Estimating Facility Shutdowns

    To estimate the percentage of facilities shutting down due to the increase
in CFC prices, the percentage reduction in CFC use in a foam-blowing segment due
to end-product substitution was estimated.  (Other reductions in CFC use will
occur because of changes in manufacturing processes and chemical input
substitutions.)  End-product substitution refers to the substitution of other
products for CFC-blown products.  For example, end-product substitution'occurs
when, in response to higher CFC-blown product prices, fiberglass insulation is
used instead of foam insulation, or paper packaging is used instead of foam
packaging.  The amount of end-product substitution is assumed to be directly
related to the number of facilities shutting down.

    The analysis assumes that end-product substitution necessarily forces
current foam-blowing facilities out of business while producers of alternative
products expand their markets.  This analysis does not allow producers to use
alternative blowing agents while accepting a lower profit to preserve market
share.  Furthermore, the analysis assumes that these facilities produce only
foam and are unable to discontinue production lines without going out of
business.  Many facilities produce multiple products, however, and can
discontinue foam production without shutting down.  Thus the assumption that
potential market penetration by product substitutes necessarily results in firm
shutdowns provides a "worst case" estimate of the effect that CFC regulations
could have on the foam-blowing industry.

4.  COMPETITIVE EFFECTS ANALYSIS

    This section presents the results of the analysis for the five foam-blowing
industries identified above.  Although the analysis below could be applied to
any of the five regulatory alternatives identified in Section 2, we focus
primarily on the analysis of the market based allocated quota alternative.
Because the market based approaches reduce CFC consumption by increasing CFC
prices, the traditional compliance costs analyzed in most regulatory impact
analyses (i.e., administrative burdens or costs of installing new equipment) are
likely to be less significant than the effect of increased prices on CFC users.
Therefore, of the EPA criteria for significant impacts, the fourth criteria--
closures of small entities — is the most important in this analysis.

     If the analysis were redone for auctioned rights, compliance costs would be
somewhat greater due to the existence of some administrative costs for this
alternative.  The engineering controls/bans alternative was deemed unsuitable
for analysis because EPA has yet to identify controls for the analysis.

     As discussed in Chapter 9, even though cost effective CFC reduction
measures may exist, CFC using industries may choose not to utilize them or may
choose to adopt them at a far slower pace than would be efficient for society as
a whole.  In order to capture the possible technology shifts in CFC using
sectors, this analysis examines the impacts of CFC regulation on foam blowing
industries for two different scenarios.  These scenarios, Case 1 and Case 2, are
described in chapter 9 of the RIA.  Case 1 assumes, among other things, that
low-cost alternative insulating and packaging materials are not available as
substitutes for many foam products and other events occur that make it more

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                                      L-12
 difficult  to  reduce CFC use.  Case 2 assumes that CFC reductions will be aided
 by the  introduction of low-cost alternative insulating and packaging materials
 and other  events occur that result in overall reduced CFC use.^

 4.1 Results

     Exhibit L-l shows the potential reduction in the size of markets served by
 foam-blowing  industries which could result from CFC regulation for the years
 1989, 1993 and 1998.  The potential reduction is shown for both Case 1 and Case
 2  described above.  The results show that for three of the sectors, flexible
 foam, rigid insulating foam--poured, and rigid insulating foam--sprayed, the
 market  share  reduction due to product substitution is insignificant.  For two
 other sectors, rigid packaging foam and rigid insulating foam--boardstock, the
 potential market share reduction is larger, reflecting the greater availability
 of product substitutes for those two segments.

     These estimated reductions in market share do not necessarily correspond to
 closures of facilities which are currently in operation.  The reductions are
 based on the  projected size of each market in each of the three years based on
 estimates of  market growth.  Some of this projected growth offsets the estimated
 reduction, and the percentage of existing facilities which will shut down is
 likely  to be  less.  The percentages in parentheses below each market reduction
 in Exhibit L-2 show the percent of facilities operating in 1986 that may leave
 the  foam-blowing industry, assuming that any reduction in market share first
 prevents new  businesses from entering the market before forcing closures of
 existing facilities.  For example, although our analysis shows that the rigid
 insulating foam--boardstock sector will incur a 48 percent reduction in market
 share under the Case 2 scenario in 1993, the percentage of 1986 facilities
 shutting down is estimated to be 22 percent.

     The actual number of facility closures may be less than predicted above.
 Facilities may have several options besides closing that are not considered in
 these estimates and could substantially reduce the number of closures.  Some
 facilities may use alternative chemicals as blowing agents, e.g., pentane, HCFC-
 22,  HCFC-141b, or HCFC-123.12  Other facilities may shift to the production of
 other products.  Facilities could temporarily incur a reduction in profits and a
 lower return  on capital while waiting for alternative blowing agents to become
 available.  Finally, even if in the long run some facilities are unable to
 switch production processes and alternative blowing agents do not become readily
 available, this does not imply they will shutdown immediately.  If in the short
 run  they can  cover their variable costs of production, they may choose to
     11 See exhibit 9-2 for a complete list of assumptions used in the best and
worst case scenarios.

     12 Although the analysis utilizes estimates of the cost of the use of these
alternative blowing agents, these estimates are still uncertain.  If the
estimates are too high, more chemical substitution will occur than estimated
here.   As an example of the potential for the use of these blowing agents,  many
rigid foam packaging producers have recently decided to switch to the use of
HCFC-22 in their production processes.

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                                      L-13
                                  EXHIBIT L-l

                      ESTIMATED REDUCTION OF MARKET SHARE
                        IN THE FOAM-BLOWING INDUSTRIES^/
                                 Reduction In CFG-Blown Market Share
                     	Case 1	         	Case 2	
                     1989        1993     1998          1989     1993      1998
Flexible Foam          0%         0%       0%            0%S/      0%        0%
                      (0%)       (0%)     (0%)           (0%)£/    (0%)       (0%)

Rigid Packaging       11%        24%      24%            28%       36%        36%
Foam                  (0%)       (0%)     (0%)           (1%)     (16%)       (0%)


Rigid Insulating       0%         0%       0%            0%        0%        0%
Foam--Poured          (0%)       (0%)     (0%)           (0%)      (0%)       (0%)


Rigid Insulating       1%        18%      26%            0%        48%       52%
Foam--Boardstock      (0%)       (0%)     (0%)           (0%)      (22%)      (4%)


Rigid Insulating       0%         5%       5%            5%         5%       5%
Foam--Sprayed         (0%)       (0%)     (0%)           (0%)       (0%)      (0%)


a/  The assumed stringency and coverage assumptions used are those of the CFC
    50%/Halon Freeze case described in chapter 5.  CFCs  are regulated with an
    initial freeze in 1989 at 1986 levels, 20 percent reduction in 1993, and 50
    percent reduction in 1998, and halons are frozen at  1986 levels in 1992.
    The assumed rate of growth in baseline use is the Kiddle Growth Scenario
    described in Chapter 4.

b/  Estimated reduction in market share based on predicted market size.

c/  Estimated percentage of facilities operating in 1986 which shut down.

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                                      L-14
                                  EXHIBIT L-2

                      ESTIMATED REDUCTION OF MARKET SHARE
               IN THE RIGID INSULATING -- BOARDSTOCK SECTOR WITH
             REDUCED MARKET PENETRATION FOR PRODUCT SUBSTITUTES
                                 Reduction in CFC- Blown Market Share
                     _ Case 1 _          _ Case 2 _
                     1989      1993      1998          1989      1993      1998
Base Case
1%
(0%)
18%
(0%)
26%
(0%)
0%^ 48%
(0%)£/ (22%)
52%
(4%)
Reduced Penetration    1%       13%       16%            0%        0%        0%
Assumption            (0%)      (0%)      (0%)          (0%)      (0%)      (0%)
a/  The assumed stringency and coverage assumptions used are those of the CFC
    50%/Halon Freeze case described in chapter 5.  CFCs are regulated with an
    initial freeze in 1989 at 1986 levels, 20 percent reduction in 1993, and 50
    percent reduction in 1998, and halons are frozen at 1986 levels in 1992.
    The assumed rate of growth in baseline use is the Middle Growth Scenario
    described in Chapter 4.

b/  Estimated reduction in market share based on predicted market size.

c/  Estimated percentage of facilities operating in 1986 which shut down.

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                                      L-15
continue operation while depreciating their capital stock.  These actions could
significantly reduce the number of closures predicted.

    Also these estimate of facility closures depend on assumptions about the
degree to which alternative products penetrate existing markets for CFC-based
foam products.  The estimates used here could be higher than the penetration
which will eventually occur.  For example, the rigid foam packaging segment will
require additional capital equipment to switch to the use of HCFC-22 as a
blowing agent.  Using the analysis of Exhibit L-l which shows significant losses
in market share even with the use of HCFC-22, the wisdom of an investment in
this equipment by the rigid foam packaging industry might be questioned.
However, industry sources indicate that foam products will remain competitive by
switching to the use of HCFC-22 and that the required investment is warranted.
Thus, it is reasonable to project continued growth in this market segment and to
regard these results as a "worst case" scenario.

    The rigid foam insulation--boardstock segment is another example of the
importance of assumptions about market penetration of alternative products.  The
estimated reduction in market share cited in Exhibit L-l assumed that small
increases in the price of CFG-blown products would result in losses of market
shares to alternative products.  Even if other insulation materials offer
equivalent insulating capacity on a per dollar basis, current users of CFC-blown
foam insulation may choose not to switch products due to their familiarity with
CFC foam or because of other characteristics of CFC foam, besides insulating
capacity, that make it more desirable than alternatives (for example, ease in
shipping and handling).

    Therefore, product substitution for foam insulation may not necessarily
occur with relatively small increases in prices.  We estimated the market share
reductions for the rigid insulating--boardstock sector if a twenty percent price
increase in CFC-blown products is required before these alternate insulating
materials become competitive with foam insulation.  Exhibit L-2 shows the result
of this analysis.  As expected, the reduced competition from alternative
insulating materials would eliminate all loss of markets in Case 2 and virtually
eliminate all losses in Case 1.  If these alternative assumptions about the
competitiveness of foam insulation were correct, no currently operating rigid
foam facilities would be forced to close in either cost scenario.

    Exhibit L-3 shows the estimated impacts of CFC regulations on foam-blowing
industries according to the other three SBA criteria:-"

        (1) more than a 5 percent increase in total costs,

        (2) higher cost increases on small firms than large firms, and

        (3) substantial increases in capital costs.
     13 For this analysis, three segments,  rigid insulating foam--poured, rigid
insulating foam--boardstock, and rigid insulating foam--sprayed, were combined
into one segment:  rigid foam--insulation.   These three were combined because of
the difficulty in separating the three segments according to SIC codes.

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                                      L-16
                                  EXHIBIT L-3

              IMPACTS OF CFG REGULATION ON FOAM-BLOVING BUSINESSES
                     ACCORDING TO FIRST THREE SBA CRITERIA^/
Case 1
1989 1993 1998
Case 2
1989 1993 1998
Criteria 1. Compliance Costs as a Percent of Production Costs
Flexible Foam 7.88% 5.04% 4.33%
Rigid Foam- -Packaging 9.33% 2.18% 2.43%
Rigid Foam- -Insulation 46.95% 17.21% 16.66%
0.00% 1.74% 4.86%
0.80% 0.12% 0.23%
0.00% 8.85% 14.34%
          Criteria 2.  Percentage Difference Between Compliance Costs
                Divided by Sales for Small Versus Large Firms ^-/

Flexible Foam                     -0.11%    -0.07%     0.00%   -0.02%   -0.07%
Criteria 3. Compliance -Related Capital Costs as a Percent
of Capital Funding Available
Flexible Foam 12.51% 16.28%
Rigid Foam --Packaging 10.28% 0.00%
Rigid Foam- -Insulation 0.00% 0.00%
0.00% 0.00% 0.00% 22.06%
0.00% 10.54% 0.08% 0.00%
0.00% 0.00% 0.00% 0.00%
a/  The assumed stringency and coverage assumptions used are those of the CFC
    50%/Halon Freeze case described in Chapter 5.  CFCs are regulated with an
    initial freeze in 1989 at 1986 levels, 20 percent reduction in 1993, and 50
    percent reduction in 1998, and halons are frozen at 1986 levels in 1992.
    The assumed rate of growth in baseline use is the Middle Growth Scenario
    described in Chapter 4.

b/  This criterion was applied only to the flexible foam segment.  The number of
    large facilities in the rigid foam industry is insignificant.

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                                      L-17
    We test whether the first criteria for significant impact is exceeded by
dividing the model firm's total annual compliance costs by the difference
between sales and pretax profits (production costs.)  If the ratio for the model
small facility in the industry is five percent or greater, then the condition
has been met.

    The second criteria for significant impact depends on the ratio of total
annual compliance costs divided by production costs for large facilities
compared to .the same ratio for the average small facility.  Because our'analysis
shows that large facilities comprise a significant fraction of only the flexible
foam industry, this criteria is only applied to that segment.  For this analysis
we chose both a model small facility and a model large facility from the
flexible foam industry.  If the ratio for the model small facility is ten
percent greater than the ratio for the model large facility, this condition has
been met.

     The third criteria for finding a significant impact is that the capital
costs of compliance represent a significant portion of available financing where
available financing includes internal cash flow plus external financing.
Because no good measures of external financing availability exist, we have
compared the capital costs to internal cash flow measured as after-tax profits
plus depreciation.*•**  If the one-time capital cost of the regulation for the
model facility exceeds fifty percent of one year's internal cash flow, we have
assumed that the capital cost is significant.-

    The results of this analysis show that the compliance costs as a percent of
production costs--SBA's first criterion--are insignificant for the flexible foam
and rigid foam--packaging sectors under the Case 2 scenario.  These sectors
realize significant impacts in 1989 under the Case 1 scenario.  The rigid foam-
insulation sector realizes insignificant impacts under both the Case 1 and Case
2 scenarios in all years except 1989.  The high compliance costs in 1989 under
the Case 1 scenario are due to that scenario's simulated large increase in CFC
prices ($6.69/kg) in that year.  Despite the seemingly high magnitude of these
estimates, the higher costs incurred cannot be assumed to force many of these
firms to shutdown.  The analysis above has already estimated the extent to which
these facilities would lose market share due to product substitutes.  Thus, much
of the increased compliance costs presented in Exhibit L-3 could be passed on to
foam consumers.  Furthermore, this analysis is based upon the most likely
regulatory program considered by EPA, that of allocated quotas, which minimizes
compliance costs.  A more traditional regulatory program, command and control,
would increase compliance costs greatly across all user groups including the
rigid foam insulation segment.

    Applying the second criteria--the percent difference between compliance
costs divided by sales for small versus large facilities-- we found there to be
little difference in compliance costs for small and larger facilities in the
flexible foam segment (this is the only segment with a significant number of
large facilities).  However applying this criteria within the framework of our
analysis is somewhat problematic.  Our analysis of compliance costs is largely
based on increased prices for CFCs and does not capture any savings in CFC
     1* This construction is quite conservative since some external financing is
likely to be available to some firms.

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                                      L-18
expenses that may be available to large facilities  (e.g., reduced prices due to
larger purchases).  Nor are any economies in scale  in use reduction options
captured.  For example, some capital expenditures to reduce CFC use may be as
expensive for small facilities as large.  In addition, we assume that all firms
are totally involved in foam production, while many larger firms may in fact
produce several types of products and would be less affected by increases in CFC
prices.  Although the analysis may be limited by these assumptions, there does
not appear to be anything in the market-based approach of an allocated quota
system that would suggest a differential impact on  small facilities versus large
facilities.

    Under the third criteria, we found compliance-related capital costs15 as a
percent of capital funding available to be small (i.e., under 50 percent) in all
three years under both scenarios.  The flexible foam segment does incur a higher
percentage than the other segments particularly under the best case scenario in
1998.  These results indicate that few of the projected responses of the foam-
blowing industry involve large capital expenditures.

5.  EXEMPTIONS AND ALLOWANCES

    Another component of the Regulatory Flexibility Analysis requires EPA to
consider exemptions and allowances for industries most severely affected by the
proposed regulation.

    The foam-blowing industry consumed approximately 30 percent of the total
volume of CFCs used in the United States in 1985.   To exempt the foam-blowing
industry from this regulation, and continue to meet the United States'
commitment to the International Protocol, the EPA could place undue burdens upon
the other industry groups and consumers which could face more significant price
increases than expected for CFCs.  For example, if  30 percent of the domestic
CFCs were set aside or exempted for the foam industries, and a 20 percent
reduction of CFC production were required by 1993 according to the Montreal
Protocol, the remaining nonexempt industries such as the electronics,
refrigeration and air conditioning industries could face nearly a 30 percent
reduction in their use, rather than 20 percent.  Thus, an exemption for the
foam-blowing industries could require the remaining non-exempt industries to
face larger than expected price increases to CFCs to subsidize the foam-blowing
industries.  EPA believes that such an approach is  inconsistent with the
objective of its market-based regulation and induces overall economic
inefficiencies.

    Furthermore set asides or exemptions present considerable administrative
difficulties.  First, the EPA must allocate the temporarily exempted CFCs to the
specific foam-blowing firms, or conduct an auction  of the exempted CFCs within
this specific market.  With large number of foam-blowing firms, EPA would need
to track these firms to guarantee each firm's allocation.  Furthermore, two
different CFC prices would develop.  The foam-blowing industry would be faced
with one price for the same CFC unit; the non-exempt industries would face a
     15 Capital costs were allocated to the model facility in the same manner as
operating costs, i.e, each model facility was assumed to bear a share of total
industry capital expenditures equal to its a share of industry use of CFCs.

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                                     L-19
higher price for the same CFC unit.  This price differential would have
repercussions on any CFC trading procedures implemented under this regulation
and would require significant policing to guarantee that trading occurred only
within the two segmented CFC markets not between the two markets.  In addition
to more detailed involvement in trading transactions, EPA enforcement actions
would certainly increase to prevent firms within the foam-blowing industries
from reselling their lower cost CFCs to non-exempt industries.

    Even with the implementation of a system of set asides which allocate
amounts of CFCs for the foam-blowing industry, foam-blowing industries would not
necessarily realize a lower reduction in market share.  Exhibit L-4 estimates
the market reductions for a system of set-asides in which 100% of the foam-
blowing industry's 1986 use of CFCs would be set aside for 1989; 80% of its 1986
use would be set aside for 1993; and 50% of its 1993 use would be set aside in
1998.  The results, presented for Case 2 only, show the same market reductions
as the market-based regulatory approach without set-asides, except for a slight
decrease in 1989 for the rigid packaging foam industry, and in 1993 in the rigid
insulating foam--boardstock industry (indicated in bold face type.)  Both
decreases are transitory since both industries do not need set asides to protect
their market shares in other years.  Also, the effect of set asides on the rigid
insulation segment is small -- the number of existing facilities which are
estimated to remain in business due to their receipt of additional CFCs is only
two percent.  Analysis of a system of set asides for the Case 1 scenario (in
which lower penetration of alternate products is assumed) shows they have no
effect whatsoever.

    In other words, this analysis shows that a system of set asides will not
help the foam blowing industries.  Foam products are estimated to experience
declines in their market shares as a result of CFC price increases.  However,
they will be able to substantially reduce- their CFC use by switching to
alternative blowing agents.  Also increases in the general size of the market
for foam products will enable existing firms to continue to operate at nearly
the same level of business they received in 1986.  A system of set asides over
the longer term would guarantee only one-half of this existing business base.

6.  SUMMARY

    This regulatory flexibility analysis examines the effect CFC regulations on
small businesses.  Of the many industries using CFCs, the analysis concentrates
on the foam blowing industries exclusively because they most likely to be
significantly effected by increases in CFC prices.

    The foam-blowing industry was divided into five sectors.  The analysis
predicts that three of these sectors-- flexible foam, rigid foam-poured, and
rigid foam-sprayed-- will not suffer a severe loss of market share.   The
flexible foam industry is not severely affected because of its ability to switch
to alternative techniques such as water-blown foam and suffers little loss in
market share.  The analysis predicts that substantial shares of CFC-blown foam
markets may be lost in the rigid foam insulation--boardstock and rigid foam
packaging industries during the 1990's.  However, the number of 1986 businesses
in these industries expected to shut down is considerably less than the

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                                      L-20
                                  EXHIBIT L-4

                      ESTIMATED REDUCTION OF MARKET SHARE
           IN THE FOAM-BLOWING INDUSTRIES WITH SET ASIDES:  CASE
                     	Reduction in CFG-Blown Market Share	
                       No Set-Asides Granted              Set Asides Granted
                     1989      1993      1998          1989      1993      1998
Flexible Foam          °* „/     °*        °%            °*        0%        0%
                          "'    (0%)      (0%)          (0%)      (0%)      (0%)
Rigid Packaging       28%       36%       36%           28%       36%       36%
Foam                 (19%)     (16%)      (0%)          (0%)     (16%)      (0%)


Rigid Insulating       0%        0%        0%            0%        0%        0%
Foam-Poured          (0%)      (0%)      (0%)          (0%)      (0%)      (0%)


Rigid Insulating       0%       48%       52%            0%       48%       52%
Foam--Boardstock      (0%)     (22%)      (4%)          (0%)     (20%)      (4%)


Rigid Insulating       5%        5%        5%            5%        5%        5%
Foam—Sprayed         (0%)      (0%)      (0%)          (0%)      (0%)      (0%)


a/  The assumed stringency and coverage assumptions used are those of the CFC
    50%/Halon Freeze case described in Chapter 5.  CFCs are regulated with an
    initial freeze in 1989 at 1986 levels, 20 percent reduction in 1993, and 50
    percent reduction in 1998, and halons are frozen at 1986 levels in 1992.
    The assumed rate of growth in baseline use is the Middle Growth Scenario
    described in Chapter 4.  Analysis of set asides using Case 1 assumptions
    showed no changes whatsoever in reductions in market share.

b/  Estimated reduction in market share based on predicted market size.

c/  Estimated percentage of facilities operating in 1986 which shut down.

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                                     L-21
estimates of market reduction, because of the estimated increase in the size of
the-overall market for foam products.  Furthermore, for such industries as rigid
foam packaging, increased costs may not result in the loss of market share
estimated here.  Such factors as consumer preferences or established
distribution chains will most likely provide a continued market for foam
products.  Rigid foam insulation may be similarly affected, especially if
consumers consider the energy costs related to the lower insulating values of
the alternative insulation, a cost which is not easily captured within these
analyses.

      Small changes in our assumptions could have significant changes in our
results.  For example, the estimated losses in market share for rigid insulating
foams are predicated on assumptions of the availability of low cost  materials
of equivalent insulating capacity to CFG-blown foams.  Increases in the costs of
these materials significantly reduce their market penetration, and would benefit
the foam insulation industries.  In addition, current foam insulation users may
have other reasons, besides insulating capacity, for not switching to
alternative products.  Also, the analysis has not been able to fully assess the
ability of CFC blowing facilities to switch to the use of alternative blowing
agents.  Finally, the analysis assumes that any reduction in the sale of CFC-
blown products causes facilities to shut down.  In reality, facilities may not
shut down, but choose to operate at reduced levels of profit or may simply
switch to the production of alternative products.

    An analysis of set asides for the foam industry shows that they would have
little impact.  Because this analysis projects substantial growth in the demands
for foam products and estimates that many foam blowers can switch to alternative
blowing agents and remain competitive in their industries, a system of set
asides of CFCs for foam manufacturers would not increase the number of existing
foam blowing firms estimated to continue in operation.

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                                   APPENDIX M

                     CHLOROFLUOROCARBON USE CONTROL OPTIONS

                       Analysis of Administrative Burdens
EXECUTIVE SUMMARY
    This appendix presents the results of an analysis of the administrative
burdens, for both EPA and affected firms, associated with the implementation of
each of six alternative means for controlling the use and emissions of
chlorofluorocarbons (controlled substances).  Administrative steps, subdivided
into start-up and operations phases, are identified and the costs of each step
estimated using available information (from similar previous EPA efforts) and
best professional judgment.  Industry steps include some actions which are
voluntary (not required by regulation), but which are included for cost
estimation purposes because they seem basic to an effective compliance strategy.
The costs estimated here relate only to implementation of regulations once they
have been promulgated.

    The six controlled substance control options analyzed in this appendix
include three based upon economic incentives (auctioned rights, allocated
quotas, and regulatory fees), one employing a more traditional regulatory
approach (direct regulations), and two combining economic incentives and
traditional regulation (allocated quotas/regulatory fees and allocated
quotas/direct regulation).   A summary of cost estimates for each option is
provided in Exhibit ES-1.  Detailed cost breakdowns for each option are provided
in Exhibits 5 through 10.

    For EPA, the most resource-intensive options are direct regulations and the
allocated quotas/direct regulations hybrid.  This is due to the increased
compliance monitoring activity associated with the specific regulations included
in those two options.  The four alternatives which rely solely or predominantly
on economic incentives -- auctioned rights, allocated quotas, regulatory fees,
and the allocated quotas/regulatory fees hybrid -- are all considerably less
resource-intensive.

    For industry, the same result occurs.  This is due largely to the costs
voluntarily incurred by firms in planning operational responses to the direct
regulations and (in parallel to EPA steps) the costs associated with
non-voluntary compliance activities.  The auctioned rights option is relatively
resource-intensive for industry, compared to the allocated quotas and regulatory
fee alternatives, due to the costs undertaken voluntarily by firms participating
in EPA's rights auction,  planning operational responses to the auction system,
and engaging in transferring rights to other parties.  These costs of conducting
transfers are not strictly comparable to the involuntary costs.  They confer
benefits and will occur only if they are in the firms' best interest.  Although
the hybrid options combine various approaches,  the cost estimates are not
strictly additive.  In the allocated quotas/direct regulations hybrid, this is
due largely to the fact that the hybrid includes only two of the specific
regulations from the direct regulation option.   In the allocated
quotas/regulatory fees hybrid, this is due to nearly identical recordkeeping and
compliance steps, contained in both options.

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                                                                        EXHIBIT ES-1
                                                            CONTROLLED SUBSTANCE CONTROL OPTIONS
                                                        COMPARISON OF ADMINISTRATIVE BURDEN ESTIMATES

Start-Up



Operations




Total Cost
Through
The First
Year Of
Operations



EPA
$1.9 million
1.9 FTE
Undustry
$37.9 million
EPA
$4.8 million
25.2 FTE
Industry
$45.7 million
ERA

$6.7 million

27.1 FTE
Industry.
$83.6 million
Allocated Quotas
EPA
$1.0 million
1.1 FTE
Industry
$0.5 million
EPA
$2.1 million
13.8 FTE
Industry.
$1.9 million
EPA

3.1 million

14.9 FTE
Industry
$2.4 million
Regulatory Fees
EPA
$1.1 million
1.7 FTE
Industry
$0.4 million
EPA
$1.2 million
7.6 FTE
Industry
$0.5 million
EPA

$2.3 million

9.3 FTE
Industry.
$0.9 million
Direct Regulations
EPA
$0.6 million
0.2 FTE
Industry
$226.8 million
EPA
$23.0 million
32.6 FTE
Industry
$122.4 million
EPA

$23.6 million

32.8 FTE
Industry
$349.2 million
Allocated Quotas
Regulatory Fees
EPA
$1.6 million
2.2 FTE
Industry.
$0.9 million
EPA
$2.6 million
14.8 FTE
Industry.
$2.1 million
EPA

$4.4 million

17.0 FTE
Industry.
$3.0 million
Allocated Quotas
Direct Regulation
EPA
$1.4 million
1.2 FTE
Industry
$225.6 million
EPA
$24.9 million
45.9 FTE
Industry.
$123.7 million
EPA

$26.3 million

47.1 FTE
Industry
$349.3 million
                                                                                                                                                                s
                                                                                                                                                                 I
                                                                                                                                                                to
* Does not include the expense of engineering and cost studies to develop regulations.

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                                     M-3
    Evaluation and use of the results of this analysis should be based on an
understanding of its limitations.  The focus of this appendix is narrowly on the
cost of administrative actions taken to implement each controlled substance
control option.  The assumptions used here have been based, where possible, on
prior EPA efforts to determine costs associated with other regulations and on
best professional judgment.  An effort was made to obtain industry cost
estimates from controlled substance production industry representatives;
however, discussions with industry officials underlined the difficulty of
precisely costing the steps involved in administering any of the control options
analyzed here.  Although time did not permit undertaking sensitivity analyses,
the assumptions and methodologies underlying this appendix are clearly itemized,
facilitating such analysis for any or all implementation steps.

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                                     M-4
I.  INTRODUCTION

A.  Scope and Structure of Paper

    The objective of this report is to analyze the principal administrative
burdens, for- both EPA and affected firms, associated with the implementation of
each of six alternative means for controlling chlorofluorocarbon (controlled
substance) use and emissions.  The analysis presented here is but a component of
a larger regulatory impact analysis.  The term "administrative burden" includes
only the direct administrative costs of planning and implementing each
alternative.

    For EPA, these burdens include the staff and contractor costs incurred
subsequent to development and approval of necessary regulations.  Costs are
subdivided into two phases -- "start-up" and "operations."  Start-up or planning
costs are assumed to be incurred in the first year after regulations are
promulgated; implementation costs are annual estimates assuming full operation
of each control option.  EPA costs do not include the costs of promulgating
regulations for any of the six options.  Costs estimated here relate to
implementation of regulations once they have been promulgated.

    For firms affected by the control options, costs (also subdivided into
start-up and operations phases) include only the burdens directly associated
with responding to EPA regulatory and program implementation actions.  Some
industry administrative costs are mandated by the regulations (e.g., reporting)
while others may be voluntarily assumed by industry (e.g., transferring
auctioned permits) if it is in the firms' economic self-interest.  Excluded from
the definition of "administrative burden" are such macroeconomic impacts as
changes in employment and income and such microeconomic impacts as changes in
the relative competitive status of individual firms.

    With these objectives and limitations in mind, this paper is structured to
include:

    •    A description of each of the six alternative means of controlling
         controlled substance use and emissions;

    •    A discussion of the methodology used to estimate EPA and industry
         administrative burdens;

    •    A discussion of the caveats and limitations that affect the results of
         this analysis; and

    •    An estimate of the administrative burdens associated with the six
         control options based upon a detailed analysis of the steps required to
         implement each.  Each step has been costed based upon clearly
         identified assumptions, readily available data, and best professional
         j udgment. *•
       Due to the uncertain nature of administrative action by industry to these
regulations, limited data collection has been undertaken for purposes of this
analysis.  A meeting with industry representatives to discuss cost estimates was
held but yielded limited information on the administrative burden of the

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                                     M-5
B.  Summary Description of Control Options

    As previously noted, this report analyzes the administrative burdens
associated with six alternative means of controlling the use and emission of
chlorofluorocarbons and halons (controlled substances).  These include three
options based upon economic incentive approaches -- auctioned rights, allocated
quotas or allowances, and regulatory fees.  The fourth option is a direct
regulatory approach requiring engineering controls and bans and reductions.   The
fifth option is a hybrid combining allocated quotas and regulatory fees'.  The
final option is another hybrid combining allocated quotas and direct
regulations.

    In order to provide background for the detailed analysis below, the
following is a brief description of each of the six control mechanisms under
consideration.  While many different design options are possible for each
alternative, the following descriptions present prototypical designs for each:

    Auctioned Rights:  An auctioned rights system would control controlled
substances by requiring a company to purchase the rights for the production and
consumption of these chemicals.  Companies seeking to use controlled substances
would have several options.  They could either purchase rights at a periodic
auction held by EPA, acquire them from other firms who had purchased rights at
auction, or buy controlled substances through their current supply channels that
already had purchased rights.  Under the last option, controlled substance
producers, or wholesalers would acquire rights, eliminating the need for their
customers to directly obtain rights themselves.  Controlled substance users
could purchase rights and controlled substances separately or could avoid the
need for rights altogether if their supplier has previously purchased rights in
sufficient quantities to cover their sales.  Over time, increasing demand for
controlled substances (for use in products produced with or containing
controlled substances), and a limit on the number of controlled substance rights
in order to meet regulatory targets, will result in an increase in the price of
rights.  Price increases will provide an incentive for firms with relatively
inexpensive options to reduce their controlled substance consumption through
low-cost substitutes, controlled substance recycling or controls, and/or new
production technologies.  Exhibit 1 graphically illustrates how an auctioned
rights system might work.

    Allocated Quotas:  An allocated quotas system would directly control
controlled substances by setting limits on, and requiring quotas for, the
production and consumption of controlled substances.  The allowable level of
controlled substances (set by the regulatory target) would be allocated among
current controlled substance producers and importers based on their historic
market share.   Production limits together with growing demand for controlled
substance products would result in higher prices, providing an incentive for
controlled substance users to reduce their consumption through lower-cost
substitutes, controlled substance recycling,  and/or new production technologies.
Transfer of production rights and consumption rights among producers and
proposed regulations.  However, many of the costs assumed for individual
administrative steps (e.g., site visits, reporting) were based on trips to
chemical plants to review recordkeeping, the producer meeting, and EPA's
experience reviewing data for the 1986 baseline.

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                                     M-6



                                  EXHIBIT 1

               HOW AUCTIONED PERMITS IMPLEMENT REGULATORY GOAL
                                  Regulatory Goal
                           established by EPA rulemaking
                             Permits limited to restrict
                              supply of CFCs to level
                               set in regulatory goal
                          Price rises as demand for goods
                      using the CFCs increases and availability
                                 of CFCs is limited
                                      Firms
                                    using CFCs
                                     evaluate
                                      options
          Continue same
        level of CFC use,
           buy permits
             Reduce use of CFCs,
                 buy permits
 Eliminate
use of CFCs
Buy from EPA
  at auction
Buy already permitted
CFCs or buy permits
from another auction
     participant
                   Use
                 substitute
                 chemicals

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                                     M-7
importers would be allowed.  Exhibit 2 graphically illustrates how an allocated
quotas system would work.

    Regulatory Fees:  A regulatory fee system would control controlled substance
emissions by imposing a fee per unit of controlled substance production or
importation.  This fee would increase the cost of products containing or
produced with controlled substances (since controlled substance users would pay
the cost of controlled substances plus a set fee),  providing an incentive to
consumers to reduce their controlled substance use through lower-cost product
substitutions, controlled substance recycling, and/or new production
technologies.  The fee would be modified over time, as necessary, to ensure the
regulatory target is met.  Exhibit 3 graphically illustrates how a regulatory
fee system would work.

    Direct Regulations;  A more traditional regulatory system for controlling
controlled substances would include the issuance of process or engineering
control restrictions, product bans, or other forms of regulation aimed at
directly reducing controlled substance use in particular industrial categories.
An initial list of regulated uses would be issued to achieve a specified control
goal (e.g., a freeze or 20 percent reduction); that list could be expanded over
time if controlled substance use in non-regulated areas continued to grow or if
additional reductions were required as part of a phase-down.  In contrast to the
three economic incentive-based approaches discussed above, in which firms would
have a choice of preferred controlled substance reduction strategies, EPA would
select specific control targets under a command-and- control regulation.
Exhibit 4 graphically illustrates how a direct regulatory approach would work.

    Allocated Quotas/Regulatory Fees Hybrid:  Direct regulatory and economic
incentive approaches each have their strengths and weaknesses.  Different
combinations of the two approaches are possible and potentially attractive.  One
such hybrid approach combines the allocation of production quotas among current
producers/importers with the imposition of a fee per unit of controlled
substance production/importation.  Allocation of quotas is tied to a cap and
would be made on the basis of historic market share.  The regulatory fee would
in effect tap increased profits realized by the firms holding allocations due to
the increased price of controlled substances caused by the production and
consumption cap.

    Allocated Quotas/Direct Regulations Hybrid:  A second hybrid approach would
involve regulating specific uses of controlled substances (i.e., through
engineering controls and controlled substance use bans and reductions) along
with setting a production cap.   The specific targeted requirements would ensure
reductions occurred in those uses where low cost options are clearly available.
The allocated quotas system would provide a ceiling to ensure that the
regulatory goal is achieved (e.g., a freeze or 20%  reduction) and would rely on
price incentives  to guard against increased controlled substance use in areas
not subject to specific restrictions.

C.  Description of Analytical Methodology

    The methodology used to perform this analysis of the EPA and industry
administrative burdens associated with the six alternative controlled substance
control approaches is straightforward.   The basis of the analysis is the
identification of the principal steps  involved in the implementation of each

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                       M-8



                   EXHIBIT 2


HOW ALLOCATED QUOTAS  IMPLEMENT REGULATORY GOAL
                   Regulatory Goal
       Regulatory uoal
established by EPA rulemaking
             Total production quota set to
                 meet regulatory goal
                Quota allocated among
                  producers/importers
                  Price rises for CFCs
                        Firms
                     'using CFCs'
                       evaluate
                       .options/


Continue same
level of CFC use,
pay higher price




Reduce use of CFCs,
pay higher price





Eliminate
use of CFCs




Recycle
CFCs



Use
substitute
processes



Use
substitute
chemicals

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                       M-9
                    EXHIBIT  3


HOW REGULATORY FEES  IMPLEMENT REGULATORY GOAL
               Regulatory Goal
        established by EPA rulemaking
           Fee set/modified to reach
               regulatory goal
             Price rises for CFCs
                   Firms
                 using CFCs
                  evaluate
                   options
            Reduce use of CFCs,
                   pay fee
 Eliminate
use of CFCs
 Continue same
level of CFC use,
     pay fee
                                 Use
                              substitute
                              processes
       Use
     substitute
     chemicals
                           Recycle
                            CFCs
                                EPA
                              evaluates
                              production
                                levels
       Under-
         or
       over-
       control
                                Goal
                              achieved

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                      M-10



                     EXHIBIT 4

HOW DIRECT REGULATIONS  IMPLEMENT REGULATORY GOAL
                    Regulatory goal
             established by EPA rulemaking
                       evaluates
                        control
                        options
          EPA issues initial/future engineering
          control, CFC use ban regulations, etc.
             for  specific industrial categories
                   Firms using CFCs
                 comply with regulations

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                                     M-ll
control mechanism and the estimated costs associated with each step.  For both
EPA- and industry these steps are divided into a start-up phase, involving the
planning and design of control program elements, and an operations phase
assuming that implementation has been fully phased-in.  In many cases, these
major steps have been subdivided into more detailed activities.  The costs
associated with each major step have been estimated by identifying the number of
times the step will be undertaken, the number of hours required to complete each
step, and the total dollar cost.  For EPA, costs are subdivided into Agency and
contractor costs; for industry, costs are subdivided into separate estimates for
producers, importers, first-line users (for auctioned rights), and other
affected controlled substance users (for direct regulations).

    Evaluation of the cost estimates is facilitated by the clear identification
of key program design assumptions (provided in the text below) and analytical
assumptions (provided in footnotes to the spreadsheets in the appendices), as
well as a complete description of each implementation step.   The most important
assumptions (i.e., those which have the greatest impact on the estimated costs)
are highlighted.  The effect of specific alternative assumptions are summarized
separately.  In preparing this analysis, emphasis has been placed upon
consistency.  Similar activities have been treated similarly across different
control options.  Any differences in the treatment of similar steps is based
upon projected differences in actual implementation.  To illustrate:  Several
steps (development of controlled substance transfer systems, for example) are
common to several different control options.  In some cases these steps have
been costed identically; in other cases, they have been assigned different cost
estimates based upon different levels of implementation complexity or a
difference in the number of affected firms.

D.  Caveats/Limitations

    Full appreciation of the results and importance of this analysis depends in
part on an understanding of its limitations.  The most important consideration,
previously noted, is that this analysis is not intended as a comprehensive
assessment of regulatory impacts.  Its focus is narrowly on the cost of
administrative actions taken to implement each control option.  Other studies
that are part of this Regulatory Impact Analysis examine other components of the
costs of complying with controlled substance regulations.  Secondly, some
administrative actions cannot be assessed.  For example, EPA and industry at
this time do not know the frequency of certain administrative actions such as
transfers.  In these areas, EPA cannot accurately project administrative burden.
On the other hand, the Agency believes that the projected administrative cost,
if action is undertaken, is reliable.   Moreover, because significant attention
has been paid to consistency in assumptions and methodology, this analysis
should provide a reliable ordering of the relative implementation costs
associated with the six options.

    A second limitation concerns the nature of the analytical assumptions upon
which this analysis is based.  Due to time constraints,  comprehensive surveys
were not undertaken regarding the behavior of controlled substance producers,
importers, and users in response to these specific control options.   However,
information was obtained from industry representatives at a meeting convened to
discuss implementation cost estimates as well as plant visits undertaken by EPA
staff.  EPA believes that these are the best possible estimates of
administrative burden for industry given the acknowledged uncertainty by

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                                    M-12
industry of their future actions to develop recordkeeping and reporting in
accordance with the regulation.

    Clearly the results of this analysis are highly dependent on the quality of
the assumptions.  To address this concern, these assumptions, as well as the
mathematical methodology for calculating costs, have been clearly identified,
permitting the reader to substitute alternative assumptions (e.g., a higher or
lower estimate of the number of hours required to complete an implementation
task), yielding different cost estimates.

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                                     M-13
II.  ANALYSIS OF OPTIONS

A.   AUCTIONED RIGHTS

1.  Summary of Cost Estimates
    The estimated costs associated with the administrative burdens imposed by
the auctioned rights option are detailed in Exhibit 5.  In summary form', these
costs are as follows:
             Start-Up              Annual Operations       Total 1 Year Cost

EPA          $1.9 million          $4.8 million*           $6.7 million
             (1.8 - contractor)    (3.2 - contractor)      (5.0 - contractor)
              1.9 FTE              25.2 FTE                27.1 FTE

Industry     $37.9 million         $45.7 million*          $83.6 million

* Includes voluntary costs of transfers.  These costs are dependent on the
number of transfers which occur.  EPA annual operating costs will-increase $1
million for every additional 2,000 transfers that occur.


2.  Assumptions

    The analytical assumptions for the marketable rights option are as follows:

        *(1) Production and consumption rights will be distributed to winning
             parties (e.g., controlled substance producers, users,  importers or
             other parties) based on a sealed bid auction.

         (2) The number of rights to be auctioned will be based on the
             regulatory goal (e.g., a freeze at 1986 levels,  20 percent
             reduction, etc.) and any changes in that goal over time.  Rights
             will be defined using a standard controlled substance depletion
             unit.

         (3) Transfer of rights will be allowed.  Transfers among different
             controlled substances will be based upon their relative ozone
             depletion potential.

         (4) Parties will request EPA approval of any transfer transactions, and
             EPA will track and monitor balances.  Improper transactions may
             involve EPA review of past records, and require EPA to investigate
             possible fraudulent auctions.
    * Asterisks designate key assumptions which will have a significant impact
on cost estimate results.

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                                     M-14
        *(5) Producers and importers will keep records of production/import
             levels and maintain accounts reflecting all transfer activities.
             They will submit production/import reports to EPA quarterly.
             Exporters will report exports when requesting additional
             consumption rights.  Users and other parties will not 'be required
             to submit controlled substance use level reports because rights are
             tied to production/import/export levels only.  Users and other
             parties will, however, report transfer activities.

        *(6) EPA will evaluate compliance monitoring records quarterly to ensure
             producers/importers have complied with the specifications and
             balances of their rights.  EPA will also monitor activities through
             site visits to producers/importers.  A detailed EPA penalty policy
             will be developed in conjunction with the regulations.

        *(7) EPA will not require reporting of recycled controlled substances by
             non-producers.  Furthermore, it is assumed that labeling of
             recycled controlled substances will not be required.

        *(8) For industry, a full range of activities have been costed.  Some of
             these activities, however, are voluntary in nature (i.e., not
             explicitly required by the assumed control system) and will not,
             presumably, be undertaken by all firms.

         (9) No accepted technologies or facilities currently exist for
             destruction or permanent encapsulation.  EPA will develop
             guidelines and permitting procedures, however, to allow for the
             future development of these technologies.

       The assumptions for allocation of EPA/contractor hours are as follows:

         (1)  Contractors will provide technical support to EPA, particularly in
              the start-up phase.

         (2)  EPA will direct the contractors in their support activities, and
              contractors will operate the permit system once it is developed.


3.  EPA Administrative Burdens


Start-Up Phase

Step 1:  Determine the number of rights to be auctioned

    A.   Obtain historic levels from first-line buyers

         Because direct or first-line controlled substance buyers will have the
    option to participate in a controlled substance auction,  EPA will want to
    obtain information to assess the likely extent to which users will
    participate versus obtaining controlled substance rights from the secondary
    market or from producers/importers at the time they purchase controlled
    substances.  To obtain a profile of controlled substance use at this level,
    EPA will send out Section 114 letters to a statistical sample of two percent

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                                    M-15
    (140 buyers) of the approximately 7,000 direct controlled substance buyers.
    Their responses will be reviewed and used in establishing auction procedures
    and other needed information.   EPA will handle any Confidential Business
    Information (CBI) requests made in conjunction with the Section 114 letters.

    B.   Analyze historic production/import/use data from publicly available
         records, producer/importer Federal Register Notice responses,  and
         first-line buyer responses

         Having compiled all information submitted by producers/importers
    previously, and subsequently by direct users,  and all publicly available
    information, EPA will compare and analyze the data to identify discrepancies
    or discontinuities.  Such data consistency problems will be reconciled.

    C.   Calculate the number of base year rights to be auctioned

         Based upon the 1986 base year levels calculated previously, and the
    denomination of a common controlled substance right taking relative
    depletion weights into account, EPA will calculate the number of rights  to
    be auctioned in the first year.

Step 2:  Design and plan sealed bid auction

    A.   Establish procedures for bidding

         EPA will develop the basic procedural rules governing the permit
    auction process.  These rules, which are necessary to ensure an efficient
    and workable process, will cover the information bidders must provide to
    participate; the level of deposit (if any) they must provide; the process,
    media,  and format for announcing and publicizing the auction; and the
    procedures for receiving, verifying, evaluating, and awarding bids.  EPA
    will attempt to model the auction process after existing government auctions
    where possible.  EPA will also conduct a pre-bid market analysis to provide
    additional information to potential bidders.

    B.   Design bid solicitation form

         Based upon the foregoing procedural decisions, EPA will design a form
    and accompanying information and guidance to be used in notifying
    prospective bidders of upcoming auctions and the means by which bids must be
    submitted.  The form will be pretested with industry representatives.

    C.   Design bid response form

         Based upon the foregoing procedural decisions, EPA will design a form
    for use by industry in submitting sealed bids to EPA.   A uniform format  will
    ensure that EPA has all the information it needs from all auction
    participants and will facilitate objective and efficient evaluation of
    submitted bids.  The form will be pretested with industry representatives.

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                                     M-16


Step 3:  Design tracking and transfer systen

    A.   Design computer system

         EPA will design the computer system that will track all balances and
    transfers of rights.

    B.   Design process for establishing accounts of rights for auction winners

         EPA will design the process for establishing an account for each party
    that receives rights from an auction.   The account will represent the
    party's total allocation of rights.  EPA will identify the information that
    will be included in each account.  The tracking system will be used for
    monitoring balances and tracking transfer transactions.

    C.   Design process for adding new accounts

         EPA will design the process for adding new accounts to the system as
    parties obtain rights through trading.

    D.   Develop procedures for reviewing and approving requests for
         consumption, production, and conversion riehts. and for transfers

         EPA will design a system that allows one party to transfer rights to or
    from another party.  EPA will first develop procedures for conducting
    transfer activities.  This will involve defining the information and format
    that parties must provide to EPA requesting approval for such transactions.

    E.   Develop tracking routine

         EPA will develop a computer routine as part of its tracking system to
    account for transfers and approval of additional rights in order to keep an
    accurate record of total rights.  The computer routine will check
    transactions against available allocations, and modify accounts to reflect
    changes.  If balances of rights are not sufficient to cover the request, the
    system will not approve the requested transaction.  EPA will then notify
    firms of completed transactions or problems with transactions.

Step 4:  Design recordkeeping and compliance monitoring system

    A.   Develop detailed design of system

         EPA will require producers/importers to maintain daily records and
    submit quarterly reports on production/consumption levels to monitor
    compliance with production/consumption rights.  EPA will first define the
    type and scope of information needed to ensure effective monitoring.  EPA
    will then set up a computer data base  for entering information collected
    from producers/importers based on reports,  site visits, and in-house
    tracking systems.  EPA will design a method for evaluating all monitoring
    data to identify potential violations.

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                                    M-17
    B.   Develop instructions for obtaining information on production, sales.
         shipments.  use of raw materials.  total consumption rights.  potential
         production rights, production rights,  conversion rights,  and data on
         recoverable and recyclable materials

         Once EPA has defined the data required for monitoring purposes,  it will
    develop instructions for producers/importers to ensure that they understand
    which of the daily records that they maintain should he submitted to  EPA
    quarterly.

    C.   Develop instructions for obtaining information on import and export
         activities

         EPA will develop instructions,  and will require importers to submit
    data quarterly on the type and quantity of substances imported,  date  and
    port of entry, source country, importer of record,  commodity code, total for
    that quarter and control-period-to-date of calculated levels of consumption
    rights.  Exporters who are claiming consumption rights will be required to
    submit their EIN numbers, commodity code, the date  and port of exit,  the
    country to which exported, the quantities exported, and supporting
    documentation.

    D.   Determine site visit policies (for monitoring  compliance)

         In order to ensure effective monitoring of producer/importer
    compliance, EPA  will establish site visit policies.  These policies will
    address the purpose of the visit, the records to be inspected, and the
    duration and timing of the visit.   Site visit schedules will be developed
    and notices prepared which will be issued to producers/importers in advance
    of the visit.

    E.   Design operational guidelines for the violation and penalty system

         EPA will design operational guidelines for the violation and penalty
    system prepared  in conjunction with the regulation.  The guidelines will
    define the procedures in evaluating the likelihood  of a possible violation
    and will outline litigation policies.   In addition, the necessary forms and
    procedures to be used by EPA will be prepared.

Step 5:  Develop guidelines and permitting procedures for destruction and
         permanent encapsulation of controlled substances

         Although no accepted technologies exist for destruction or permanent
    encapsulation of controlled substances, EPA will develop guidelines and an
    appropriate permitting process to allow for the development of these
    technologies.

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                                    M-18


Operations Phase

Step 1:  Conduct sealed bid auction

    A.   Announce the auction in appropriate media

         EPA will implement the policy established for the conduct of the sealed
    bid auction.  The first step in this process will be the use of the bid
    solicitation form previously designed employing the media previously
    selected.

    B.   Respond to questions

         EPA will respond to any questions that interested bidders may have on
    procedures or general information about the auction.

    C.   Evaluate bids

         EPA will receive and evaluate sealed bids from interested parties.  The
    first step in this process will be to verify and record bids submitted.
    Evaluation will be based upon policies and procedures developed in the
    start-up phase.

    D.   Notify all bidders of results and provide instructions for obtaining
         rights

         Using the selected auction price and the volume of controlled
    substances requested by each winning bidder, EPA will calculate the amount
    owed by each party.  Letters notifying successful bidders of rights awarded
    and the amount they owe will be prepared and mailed.  EPA staff will be
    available to answer any subsequent inquiries.

Step 2:  Set up tracking system

    A.   Establish accounts for all successful bidders

         EPA will establish an account for each successful bidder representing
    its allocation or rights.

    B.   Establish accounts for new entrants

         As firms obtain rights through transfer transactions,  EPA will
    establish new accounts for these firms.

Step 3:  Track requests for consumption, production, and conversion rights, and
         for transfers

    A.   Receive requests for transfers and additional rights

         EPA will receive and enter into the tracking system requests to obtain
    additional consumption rights,  to convert potential production rights into
    production rights, and to transfer rights to other firms.

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                                    M-19
    B.   Evaluate requests and required documentation

         The computer routine will evaluate each request against the party's
    records to ensure that sufficient controlled substance rights are available.
    If account balances are insufficient, the routine will "reject" and "flag"
    the transaction.

    C.   Examine "problem" requests and notify firms

         A small number of these transactions will be "rejected" by the system.
    EPA will examine these problems and,contact the firms involved.  EPA may
    become involved in re-examining past transactions and investigating possible
    fraudulent activities to determine if enforcement actions are required.

    D.   Modify records

         The computer routine will modify controlled substance records
    (accounts) for each firm involved to ensure accurate tracking of rights over
    time.

    E.   Notify producers/importers/exporters of approval

         EPA will notify firms via a formal notice that requests have or have
    not been approved and will report the "balance" of their rights.

Step 4:  Conduct compliance monitoring activities

    A.   Receive and review reports on production and shipments from plants, use
         of raw materials. total consumption rights.  potential production
         rights, production rights, conversion rights, and data on recoverable
         and recyclable material

         EPA will receive and review quarterly reports, based on daily records,
    of production activity and balances of approved rights.

    B.   Receive and review reports on import and export activities

         EPA will receive and review quarterly import activity reports submitted
    by firms.   EPA will review export activity reports submitted at the end of
    the year by exporters who are not claiming consumption rights.

    C.   Obtain additional information from producers/importers/exporters as
         needed

         EPA may request additional information from firms during the year on
    production/import/export activities to complete its records.

    D.   Conduct site visits to ensure production/import/export activities are
         consistent with records

         EPA will conduct periodic site visits to monitor firms' activities and
    reporting procedures.   Visits will be scheduled and planned in advance, and
    a follow-up report will be sent to the firm.

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                                    M-20
    E.   Evaluate data on production/import/export levels (from reports, in-
         house tracking systems,  and site visits) to ensure that
         firms have complied with their limits

         EPA will review all data collected from production/import/export level
    reports, in-house tracking systems, and site visits to ensure that
    producers/importers have not exceeded their approved rights.

Step 5:  Take enforcement action as needed

    A.   Lew penalties

         EPA will review all data which indicates that a violation may have
    occurred and will take appropriate action.  Action may involve levying
    penalties.  Steps will include notifying firms of potential violations,
    preparing documentation, and calculating and negotiating penalties.  If all
    firms comply with the regulations, penalties will not be levied.

    B.   Conduct litigation

         In some cases where compliance monitoring activities indicate a
    violation, enforcement action may involve litigation.  Steps will include
    notifying firms of potential violations, preparing documentation,
    negotiations, and preparing for and conducting litigation.  If all firms
    comply with the regulations,  litigation will not be conducted.


4.  Industry Administrative Burdens


Start-Dp Phase

1.  Provide EPA with five year historic use levels in response to Section 114
    letters

    A.   Research and compile information

         In order to adequately respond to EPA's request for use information,
    first-line controlled substance buyers will research and compile data on use
    levels.

    B.   Prepare response to Section 114 letter

         Firms will prepare a response to EPA's request for use levels using the
    format specified by EPA.

    C.   Send information to EPA

         Firms will send the prepared response to EPA.

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                                    M-21


Step 2:  Evaluate expected impact of production/consumption rights on operations

    A.   Analyze impact of limits

         Upon notification from EPA of official production/consumption
    allocations, firms will conduct an analysis of the impact of limits on
    operations, prices, and production options.

    B.   Plan operational response to limits

         Operational changes will be designed based on firms' analysis of the
    impact of limits. Operational changes may include alterations in
    production/import/export levels, use of substitutes,  recycling,  changes in
    personnel, research and development, and financial plans.

    C.   Plan transfer and export activities

         Firms will plan anticipated trading activities based on their analysis
    of the expected impact of production/consumption quotas.


Operations Phase

Step 1:  Implement operational changes necessary to comply with regulations

Step 2:  Respond to bid solicitation

    A.   Conduct market analysis to determine bidding price and rights for which
         to bid

         Parties will conduct an analysis of trends in their respective markets
    in order to determine whether they should submit a bid and, if so, at what
    price and for what volume of rights the bid should be prepared.

    B.   Prepare bid

         Utilizing the bid response form designed by EPA, and based upon the
    market analysis, parties will prepare their bids.

    C.   Send bid to EPA

         Parties will submit sealed bids to EPA.

Step 3:  Obtain rights

    A.   Review bid results

         Parties will receive and review EPA notification of auction results.
    Questions, if any, will be submitted by telephone to EPA.

    B.   Send payment for awarded rights

         Successful bidders will transmit payment to U.S. Treasury for requested
    rights.

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                                    M-22



Step 4:  Evaluate expected impact of system

    A.   Analyze impact of rights obtained

         Parties will conduct an analysis of the impact of the rights purchased
    on operations and product prices.

    B.   Decide whether to transfer rights obtained

         Parties will plan anticipated transfer activities based on their
    analysis of the expected impact of the level of rights obtained on their
    operations.

Step 5:  Evaluate operations plan

    A.   Determine impact of rights obtained on operations

         Parties will evaluate whether previously implemented operational
    changes remain adequate and appropriate given the results of the auction.

    B.   Implement changes in operations

         Based upon the foregoing analysis, parties will implement the
    management and technical changes needed to meet any additional operational
    changes in response to the system.

Step 6:  Conduct transfer transactions

    A.   Prepare and submit transfer request to EPA

         Parties will contact potential trading partners and negotiate transfers
    of portions of their allocation of rights.  They will then request EPA
    approval of the transaction according to guidelines developed by EPA.

    B.   Obtain EPA approval of transfer

         Parties will obtain a notice  from EPA approving a transfer transaction.
    Parties will provide additional information to EPA, if required, to complete
    a transaction.

    C.   Modify records regarding inventory of production and consumption rights

         Firms will modify their records to reflect the transfer.

Step 7:  Obtain additional consumption rights through exports

    A.   Prepare and submit request and proof of exports of controlled
         substances

         A request for additional consumption rights along with the required
    export documentation must be submitted to EPA before additional rights will
    be granted.

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                                    M-23
    B.   Obtain additional consumption rights from EPA

         If the request is approved,  EPA will issue a notice advising the party
    of its additional rights.

Step 8:  Convert potential production rights into production rights through
         exports to parties (additional production rights are granted through
         transactions with 25 Kilotonne Parties)

    A.   Obtain production reduction documentation from embassy

         The embassy of the nation agreeing to reduce its allowable calculated
    level of production must provide documentation to the recipient of the
    amount transferred and the control period covered.

    B.   Prepare and submit request and proof of exports of controlled
         substances

         A request for conversion of rights must be prepared and submitted with
    the required documentation to EPA.

    C.   Obtain notice of production rights from EPA

         If the request is approved,  EPA will issue a notice advising the party
    of its additional rights.

Step 9:  Comply with EPA reporting and compliance monitoring requirements

    A.   Maintain records of production,  raw materials used, sales, shipments.
         controlled substances recovered and recycled, and import and export
         activities

         All producers/importers will maintain copies of daily production
    records, and import and export activities.

    B.   Prepare and submit reports on production,  feedstock consumption.
         shipments. total consumption rights.  potential production rights.
         production rights, conversion rights, and data on recoverable and
         recyclable materials

         Firms will provide quarterly information for production collected daily
    during the normal course of production.  The information will be provided in
    the firms' standard format.

    C.   Prepare and submit reports on import and export activities

         Firms conducting import activities will provide information in an EPA-
    specified format quarterly.   Firms will report export activities when
    requesting additional consumption rights.

    D.   Provide any additional information requested by EPA.

         Additional requests for production/import/export data may be made
    quarterly by EPA.  Responses will be  prepared and provided as needed.

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                                    M-24
    E.   Prepare for EPA site visits

         Firms will prepare for EPA site visits to ensure that all back-up data
    are available which document compliance with EPA requirements. '

    F.   Accommodate EPA site visits

         Appropriate corporate staff will be available to EPA staff to answer
    questions during the visit.  A corporate official will meet with the EPA
    site visit team, supply requested files, and make other individuals such as
    the production manager available as needed.  The official would interact
    with EPA on subsequent issues related to the visit.
Step 10:  Respond to any enforcement activity

    A.   Pay penalties
         Firms will respond to any enforcement activity initiated by EPA.
    Enforcement activity could include penalties for exceeding approved rights.
    Steps include negotiations, documentation, and payment of penalties.  If all
    firms comply with the regulation, no penalties will be levied.

    B.   Conduct litigation

         In some cases, enforcement activity may involve litigation.  Steps
    include negotiations, documentation, and preparation for litigation.  If all
    firms comply with the regulation, no penalties will be levied.

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                                    M-25
B.  ALLOCATED QUOTAS

1.  Sunmaxy of Cost Estimates

    The estimated costs associated with the administrative burdens imposed by
the production quota option are detailed in Exhibit 6.  In summary form, these
costs are as follows:

             Start-Up              Annual Operations      Total 1 Year 'Cost
EPA          $1.0 million          $2.1 million           $3.1 million
             (0.9 - contractor)    (1.2 - contractor)     (2.1 - contractor)
              1.1 FTE              13.8 FTE               14.9 FTE

Industry     $0.5 million          $1.9 million           $2.4 million


2.  Assumptions

     The analytical assumptions for the allocated quotas option are as follows:

         (1) The total of production/import quota will be allocated among 7
             producers and approximately 14 importers based upon historic
             market share.

         (2) Transfer of production rights among producers/importers
             will be allowed.  Transfers among different controlled
             substances will be based upon their relative ozone
             depletion potential.

        *(3) Producers and importers will keep records on production/import
             activities and submit these records to EPA quarterly.  Transfer
             activities shall be reported when they occur.  Exporters shall
             report exports when requesting additional consumption rights.
             Users will not be required to report activities.

        *(4) EPA will evaluate the compliance monitoring records quarterly
             to determine whether producers or importers have exceeded
             their production/import quotas.   EPA will also monitor
             activities through site visits.   A detailed EPA penalty policy
             will be developed in conjunction with the regulations.

        *(5) EPA will not require permitting or reporting of recycled controlled
             substances by non-producers.   Furthermore, it is assumed that
             labeling of recycled controlled substances will not be required.
     * Asterisks designate key assumptions which will have a significant impact
on cost estimate results.

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                                     M-26
          (6) No accepted technologies or facilities currently exist for
             destruction or permanent encapsulation.  EPA will develop
             guidelines and permitting procedures, however, to allow
             for the development of these technologies.

        *(7) For industry, a full range of activities have been costed.  Some of
             these activities, however, are voluntary in nature (i.e., not
             explicitly required by the assumed control system) and will not,
             presumably, be undertaken by all firms.

     The assumptions for allocation of EPA/contractor hours are as follows:

          (1) Contractors will provide technical support to EPA
             particularly in the start-up phase.

          (2) EPA will direct the contractors in their support
             activities during operations of the allocation quota
             system once it is developed.  All compliance monitoring
             and enforcement activities will remain EPA functions.


3.  EPA Administrative Burdens


Start-Up Phase

Step 1:  Establish production quotas

    A.   Calculate base year allocations based on relative shares of
         historic market

         EPA will calculate base year allocations of production and consumption
    rights for each affected firm based upon their production, import, and
    export levels and ozone depletion weights.  EPA will record in detail the
    procedures and data used to calculate each firm-specific allocation.

    B.   Notify producers/importers of final allocations of production quotas

         EPA will formally notify each producer/imported of its allocated
    production/consumption quota for a given year.  The notification will
    include an attachment describing the procedures and data used to calculate
    the rights allocated.  EPA will also answer any inquiries from
    producers/importers about allocations or procedures used to calculate
    allocations.

Step 2:  Design tracking and transfer system

    A.   Design computer system

         EPA will design the computer system that will track account balances
    and transfer activities.

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                                    M-27
    B.   Design process for establishing quota accounts

         EPA will design the process for establishing an account for each firm
    representing its total allocation of rights.  EPA also will identify the
    information that must be included in each account.  The tracking system will
    be used for monitoring balances and tracking transfer transactions.

    C.   Develop procedures for reviewing and approving requests for
         consumption, production, and conversion rights, and for transfers

         EPA will design a system that allows producers and importers to trade a
    portion of their annual rights to another producer or importer or obtain a
    portion of another firm's rights.  EPA will first develop procedures for
    conducting transfer activities.  This will involve defining the information
    and format that producers/importers must provide to EPA when requesting
    approval for such transactions.

    D.   Develop tracking routine

         EPA will develop a computer routine as part of its tracking system to
    account for transfers and approval of additional rights in order to keep an
    accurate record of total rights.  The computer routine will check requests
    against available allocations, and modify accounts to reflect changes.  If
    balances of rights are not sufficient to cover the request, the system will
    not approve the requested transaction.  EPA will then notify firms of
    approved transactions or problems with such transactions.

Step 3:  Design recordkeeping and compliance monitoring system

    A.   Develop detailed design of system

         EPA will require producers/importers to maintain daily records and
    submit quarterly reports on production/consumption levels to monitor
    compliance with production/consumption rights.   EPA will first define the
    type and scope of information needed to ensure effective monitoring.  EPA
    will then set up a computer data base for entering information collected
    from site visits, reports, and in-house tracking systems.  EPA will design a
    method for evaluating all monitoring data to identify potential violations.

    B.   Develop instructions for obtaining information on-production, sales.
         shipments, use of raw materials, total consumption rights, potential
         production rights, production rights, conversion rights, and data on
         recoverable and recyclable materials

         Once EPA has defined the data required for monitoring purposes, it will
    develop instructions for producers/importers to ensure that they understand
    which of the daily records that they maintain should be submitted to EPA
    quarterly.

    C.   Develop instructions for obtaining information on import and export
         activities

         EPA will develop instructions, and will require importers to submit
    data quarterly on the type and quantity of substances imported, date and

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                                    M-28


    port of entry, source country, importer of record, commodity code, total for
    that quarter and control-period-to-date of calculated levels of consumption
    rights.  Exporters who are claiming consumption rights will be required to
    submit their EIN numbers, commodity code, the date and port of exit, the
    country to which exported, the quantities exported, and supporting.
    documentation.

    D.   Determine site visit policies (for monitoring compliance)

         In order to ensure effective monitoring of producer/importer
    compliance, EPA will establish site visit policies.  These policies will
    address the purpose of the visit,  the records to be inspected, and the
    duration and timing of the visit.    Site visit schedules will be developed
    and notices prepared which will be issued to producers/importers in advance
    of the visit.

    E.   Design operational guidelines for the violation and penalty system

         EPA will design operational guidelines for the violation and penalty
    system prepared in conjunction with the regulation.  The guidelines will
    define the procedures in evaluating the likelihood of a possible violation
    and will outline litigation policies.   In addition, the necessary forms and
    procedures to be used by EPA will be prepared.

Step 4:  Develop guidelines and permitting procedures for
         destruction and permanent encapsulation of controlled substances

         Although no accepted technologies exist for destruction or permanent
    encapsulation of controlled substances, EPA will develop guidelines and an
    appropriate permitting process to allow for the development of these
    technologies.


Operations Phase

Step 1:  Set up tracking system and establish accounts for all
         producers/importers

         EPA will establish an account for each producer/importer representing
    its allocation of rights.

Step 2:  Track requests for consumption, production, and conversion rights, and
         for transfers

    A.   Receive requests for transfers and additional rights

         EPA will receive and enter into the tracking system requests to obtain
    additional consumption rights, to  convert potential production rights into
    production rights,  and to transfer rights to other firms.

    B.   Evaluate requests and required documentation

         The computer routine will evaluate each request against the firm's
    balance to ensure that sufficient  production/import rights are available.

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                                    M-29
    If the balance is insufficient, the routine will "reject" and "flag" the
    transaction.

    C.   Examine "problem" requests and notify firms

         A small number of these transactions will be "rejected" by the system.
    EPA will examine these problems and contact the firms involved.  EPA may
    become involved in re-examining past transactions and investigating possible
    fraudulent activities to determine if enforcement actions are required.

     D.  Modify records

         The computer routine will modify controlled substance allocation
    records (accounts) for each firm involved to ensure accurate tracking of
    rights over time.

    E.   Notify producers/importers of approval

         EPA will notify firms via a formal notice that the requests have or
    have not been approved and will report the "balance" of their rights.

Step 3:  Conduct compliance monitoring activities

    A.   Receive and review reports on production and shipments from plants.  use
         of raw materials, total consumption rights, potential production
         rights, production rights, conversion rights,  and data on recoverable
         and recyclable material

         EPA will receive and review quarterly reports  based on daily records of
    production activity and balances of approved rights.

    B.   Receive and review reports on import and export activities

         EPA will receive and review quarterly import activity reports submitted
    by firms.   EPA will review export activity reports  submitted at the end of
    the year by exporters who are not claiming consumption rights.

    C.   Obtain additional information from producers/importers/exporters as
         needed

         EPA may request additional information from firms during the year on
    production/import/export activities to complete its records.

    D.   Conduct site visits to ensure production/import/export activities are
         consistent with records

         EPA will conduct periodic site visits to monitor firms' activities and
    reporting procedures.  Visits will be scheduled and planned in advance, and
    a follow-up report will be sent to the firm.

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                                    M-30
    E.   Evaluate data on production/import/export levels (from reports.
         in-house tracking systems and site visits) to ensure that firms have
         complied with their limits

         EPA will review all data collected from production/import/export level
    reports, in-house tracking systems, and site visits to ensure that
    producers/importers have not exceeded their approved rights.

Step 4:  Take enforcement action as needed

    A.   Levy penalties

         EPA will review all data which indicates that a violation has occurred
    and will take appropriate action.  Action may involve levying penalties.
    Steps will include notifying firms of potential violations, preparing
    documentation, and calculating and negotiating penalties.  If all firms
    comply with the regulations, penalties will not be levied.

    B.   Conduct litigation

         In some cases where compliance monitoring activities indicate a
    violation, enforcement action may involve litigation.  Steps will include
    notifying firms of potential violations, preparing documentation,
    negotiations, and preparing for and conducting litigation.  If all firms
    comply with the regulations, litigation will not be conducted.


4.  Industry Administrative Burdens


Start-Dp Phase

Step 1:  Evaluate expected impact of production/consumption rights on operations

    A.   Analyze impact of limits

         Upon notification from EPA of official production/consumption
    allocations, firms will conduct an analysis of the impact of limits on
    operations,  prices,  and production options.

    B.   Plan operational response to limits

         Operational changes will be designed based on firms' analysis of the
    impact of limits.  Operational changes may include alterations in
    production/import/export levels, use of substitutes,  recycling,  changes in
    personnel, research and development, and financial plans.

    C.   Plan transfer and export activities

         Firms will plan anticipated transfer and export activities based on
    their analysis of the expected impact of production/consumption quotas.

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                                     M-31


Operations Phase

Step 1:  Implement operational changes to comply with regulations

         Firms will implement the management and technical changes'needed to
    meet operational changes in response to the regulations.

Step 2:  Conduct transfer transactions

    A.   Prepare and submit transfer request to EPA

         Firms will contact potential trading partners and negotiate transfer
    of portions of their allocation of rights.  They will then request EPA
    approval of the transaction according to guidelines developed by EPA.

    B.   Obtain EPA approval of transfer

         Firms will obtain a notice from EPA approving a transfer transaction.
    Firms will provide additional information to EPA, if required, to complete
    a transaction.

    C.   Modify records regarding inventory of production and consumption
         rights

         Firms will modify their records to reflect the transfer.

Step 3:  Obtain additional consumption rights through exports

    A.   Prepare and submit request and proof of exports of controlled
         substances

         A request for additional consumption rights along with the required
    export documentation must be submitted to EPA before additional rights will
    be granted.

    B.   Obtain additional consumption rights from EPA

         If the request is approved,  EPA will issue a notice advising the party
    of its additional rights.

Step 4:  Convert potential production rights into production rights through
         exports to parties (additional production rights are granted through
         transactions with 25 Kilotonne Parties)

    A.   Obtain production reduction documentation from embassy

         The embassy of the nation agreeing to reduce its allowable calculated
    level of production must provide documentation to the recipient of the
    amount transferred and the control period covered.

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                                    M-32
    B.   Prepare and submit request and proof of exports of controlled
         substances

         A request for conversion of rights must be prepared and submitted with
    the required documentation to EPA.

    C.   Obtain notice of production rights from EPA

         If the request is approved, EPA will issue a notice advising the party
    of its additional rights.

Step 5:  Comply with EPA reporting and compliance monitoring requirements

    A.   Maintain records of production, raw materials used, sales,  shipments.
         controlled substances recovered and recycled, and import and export
         activities

         All producers/importers will maintain copies of daily production
    records, and import and export activities.

    B.   Prepare and submit reports on production, feedstock consumption.
         shipments, total consumption rights, potential production rights.
         production rights, conversion rights, and data on recoverable and
         recyclable materials

         Firms will provide quarterly information for production collected
    daily during the normal course of production.  The information will be
    provided in the firm's standard format.

    C.   Prepare and submit reports on import and export activities

         Firms conducting import activities will provide information in an EPA-
    specified format quarterly.   Firms will report export activities when
    requesting additional consumption rights.

    D.   Provide anv additional  information requested by EPA.

         Additional requests for production/import/export data may be made
    quarterly by EPA.   Responses will be prepared and provided as needed.

    E.   Prepare for EPA site visits

         Firms will prepare for  EPA site visits to ensure that all back-up
    production/import data are available which document compliance with EPA
    requirements.

    F.   Accommodate EPA site visits

         Appropriate corporate staff will be available to EPA staff to answer
    questions during the visit.   A corporate official will meet with the EPA
    site visit team, supply requested files, and make other individuals such as
    the production manager available as needed.   The official would interact
    with EPA on subsequent issues related to the visit.

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                                    M-33


Step 6:  Respond to any enforcement activity

    A.    Pay penalties

         Firms will respond to any enforcement activity initiated b'y EPA.
    Enforcement activity could include penalties for exceeding approved rights.
    Steps include negotiations, documentation, and payment of penalties.  If
    all firms comply with the regulation,  no penalties will be levied.

    B.    Conduct litigation

         In some cases, enforcement activity may involve litigation.  Steps
    include negotiations, documentation, and preparation for litigation.  If
    all firms comply with the regulation,  no litigation will be conducted.

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                                     M-34
C.  REGULATORY FEES

1.  Summary of Cost Estimates

    The estimated costs associated with the administrative burdens imposed by
the regulatory fees option are detailed in Exhibit 7.  In summary form, these
costs are as follows:

             Start-Up              Annual Operations      Total 1 Year Cost

EPA          $1.1 million          $1.3 million           $2.3 million
             (1.9 - contractor)    (0.8 - contractor)     (1.7 - contractor)
              1.7 FTE               7.6 FTE                9.3 FTE

Industry     $0.4 million          $0.5 million           $0.9 million


2.  Assumptions

    The analytical assumptions for the regulatory fees option are as follows:

         (1)  Fees will be collected from producers and importers only.  The
              amount of fees paid will be based on the fee level for each
              controlled substance type and the quantity of regulated
              controlled substance chemicals produced or imported.

         (2)  EPA will determine the initial fee level for each controlled
              substance type, based on its relative ozone-depleting
              potential and the initial regulatory goal, and develop a
              self-adjusting fee formula that will revise the fee level,
              as necessary, to compensate for missing the regulatory
              target or to meet changes in the regulatory goal.

        *(3)  Producers and importers will calculate the amount of fees they
              owe and send payment to the U.S. Treasury and supporting data to
              EPA quarterly.

         (4)  Producers and importers will keep records on production/
              consumption levels, fees paid, and other required information and
              submit these records to EPA quarterly.

        *(5)  EPA will evaluate the compliance monitoring records quarterly
              (including production/consumption levels, fee payment reports,
              and other records) to ensure that the correct fee amount was
              submitted.  EPA will also monitor activities through site visits.
              A detailed EPA penalty policy will be developed in conjunction
              with the regulations.
    * Asterisks designate key assumptions which will have a significant impact
on cost estimate results.

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                                    M-35
        *(6)  EPA will not require permitting or reporting of recycled
              controlled substances by non-producers.  Furthermore, it is
              assumed that labeling of recycled controlled substances will not
              be required.

         (7)  No accepted technologies or facilities currently exist for
              destruction of controlled substances or their permanent
              encapsulation.  EPA will develop guidelines and permitting
              procedures, however, to allow for the future development of these
              technologies.

        *(8)  For industry,  a full range of activities have been costed.  Some
              of these activities, however, are voluntary in nature (i.e., not
              explicitly required by the assumed control system) and will not,
              presumably, be undertaken by all firms.

    The assumptions for allocation of EPA/contractor hours are as follows:

         (1)  Contractors will provide technical support to EPA particularly in
              the start-up phase.

         (2)  EPA will direct the contractors in their support activities, and
              EPA will operate the regulatory fee system once it is developed.


3.  EPA Administrative Burdens
Start-Up Phase

Step 1:  Set initial fee level and refine formula for adjusting fee level to
         yield regulatory goals

    A.    Review available data regarding the economics of the controlled
         substance industry and historical impacts of changing controlled
         substance prices

         EPA will review available data on the economics of the controlled
    substance industry,  including the historical impacts of changing controlled
    substance prices on demand and controlled substance production/import
    levels.

    B.    Review existing controlled substance model and revise as necessary to
         use in estimating appropriate fee levels

         EPA will review the existing controlled substance model to determine
    its adequacy in estimating fee levels that will yield EPA's regulatory
    production/import targets.   EPA will then make revisions to the controlled
    substance model, as necessary,  so the model can be used in estimating
    appropriate fee levels.

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                                    M-36
    C.   Run model to estimate fee levels necessary to yield regulatory
         production/import targets

         EPA will run the controlled substance model to estimate the
    appropriate fee levels necessary to yield regulatory production/import
    targets.

    D.   Finalize initial fee and self-adiusting formula contained in final
         rule

         EPA will finalize the initial fee and self-adjusting formula that will
    be outlined in the regulations.  The formula will be used to adjust the fee
    levels if they do not yield the regulatory targets or if EPA changes the
    targets.

    E.   Determine schedule and procedures for periodic reassessment of the
         self-adjusting formula

         EPA will develop a schedule and procedures for reassessing the
    self-adjusting formula to ensure it adjusts the fees appropriately to meet
    the regulatory target.

    F.   Notify producers/importers of initial fee level

         EPA will notify producers/importers of the initial fee levels set for
    each regulated controlled substance.

Step 2:  Design recordkeeping and compliance monitoring system

    A.   Develop detailed design of system

         EPA will require producers/importers to maintain daily records and
    submit quarterly reports on production/consumption levels and fee amounts
    that were submitted to the U.S. Treasury.  Fee amounts submitted will be
    based on the total controlled substances produced or imported by firms, and
    the fee levels for each controlled substance.  EPA will establish a system
    for verifying that fee amounts submitted to the U.S. Treasury are
    consistent with fee reports and with production and consumption levels.

    B-   Design and test forms and instructions for obtaining production/
         import and fee payment information

         Following design of the reporting and fee verification system, EPA
    will design and test the reporting forms and prepare instructions for the
    firms that must use the forms.

    C.   Determine site visit policies (for monitoring compliance)

         In order to ensure effective monitoring of producer/importer
    compliance, EPA will establish site visit policies.  These policies will
    address the records to be inspected, and the duration and timing of the
    visit.   Site visit schedules will be developed and notices prepared which
    will be issued to producers/importers in advance of the visit.

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                                     M-37
    D.   Design operational guidelines for the violation and penalty system

         EPA will design operational guidelines for the violation and penalty
    system prepared in conjunction with the regulation.  The guidelines will  •
    define the procedures in evaluating the likelihood of a possible violation
    and will outline litigation policies.  In addition, the necessary forms and
    procedures to be used by EPA will be prepared.

Step 3:  Develop guidelines and permitting procedures for destruction and
         permanent encapsulation of controlled substances

         Although no accepted technologies exist for destruction or permanent
    encapsulation of controlled substances, EPA will develop guidelines and an
    appropriate permitting process to allow for the future development of these
    technologies.


Operations Phase

1.  Conduct compliance monitoring activities

    A.   Receive and review reports on production/consumption levels and fee
         payments.

         EPA will receive and review quarterly production/import and fee
    payment reports.  Reports will be reviewed for completeness and accuracy.

    B.   Verify fee payment reports with U.S.  Treasury records

         EPA will verify that fee payment reports are consistent with U.S.
    Treasury records.

    C.   Obtain additional information from producers/importers/exporters as
         needed

         EPA may request additional information from firms during the year on
    production/import/export activities to complete its records.

    D.   Evaluate data on production/import levels and fees paid
         to ensure  that fees submitted reflect actual production/consumption
         levels

         EPA will review reports on production/consumption levels,  and fee
    paid,  to ensure that fees submitted reflect actual production/import
    levels.   This activity includes checking calculations made by firms on fee
    amounts owed.

    E.   Notify firms  of delinquent or incorrect fee payments

         Based on the  evaluation of production/consumption data and fee amounts
    submitted,  EPA  will issue follow-up notices to firms (where applicable)
    advising them to remit required fees.

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                                    M-38
    F.   Conduct site visits to ensure production/import levels and fee
         payments are consistent with records

         Site visits will be scheduled to monitor producer/importer record-
    keeping and controlled substance activities.  During the visit, on-site
    records will be examined and staff interviewed to ensure production/import
    levels and fee payments are consistent with records.

Step 2:  Revise self-adjusting formula as necessary

    A.   Determine if fee levels fas determined bv self-adjusting formula^
         are yielding regulatory production goals, and if formula needs to be
         revised

         EPA will -review and compare the levels of CFG production and import
    levels, and the regulatory production goals annually.  If the
    production/import goals are not being met,  EPA will revise the formula so
    it will adequately adjust the fees.

    B.   Prepare formula revisions as necessary, based on results of
         analysis, or based on changes in regulations

         EPA will revise the self-adjusting formula if fees are not yielding
    regulatory goals or if EPA changes its goals.

Step 3:  Take enforcement action as needed

    A.   Levy penalties

         EPA will review all data which indicates that a violation has occurred
    and will take appropriate action.  Action may include levying penalties.
    Steps include notifying firms of potential  violations,  preparing
    documentation, and calculating and negotiating penalties.  If all firms
    comply with the regulations, no penalties will be levied.

    B.   Conduct litigation

         In some cases where compliance monitoring activities indicate a
    violation,  enforcement action may involve litigation.  Steps include
    notifying firms of potential violations,  preparing documentation,
    negotiations, and preparing for and conducting litigation.  If all firms
    comply with the regulations, no litigation  will be conducted.

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                                    M-39
4.  Industry Administrative Burdens


Start-Up Phase

Step 1:  Obtain final fee level and formula from EPA and evaluate expected
         impact of fee

    A.   Analyze impact of fee levels

         Upon receipt and review of EPA's fee levels for controlled substances,
    firms will conduct an analysis of the impact of fees on operations.  This
    analysis will be done on a voluntary basis by firms as part of their
    on-going operating practices.

    B.   Plan operational response to fee levels

         As part of their business planning practices, operational changes will
    be designed based on firms' analyses of the impact of fees.  Operational
    changes may include alterations in production/import levels, use of
    substitutes, recycling, changes in personnel, research and development, and
    financial plans.

Step 2:  Design internal fee payment system

    A.   Set up system for determining fee amount owed

         Producers and importers will develop systems for determining the fee
    amount owed based on controlled substance production or import levels.

    B.   Set up accounting system to pay correct fee amounts to U.S Treasury

         Producers and importers will establish internal accounting systems to
    ensure timely and accurate payment of fees.

Step 3:  Design system to meet EPA reporting and compliance monitoring
         requirements

    A.   Design in-house system to track production/consumption levels and fees
         paid

         Producers and importers will develop in-house systems to track
    production/import levels against fees paid-to meet EPA compliance
    monitoring requirements.

    B.   Design reporting system to meet EPA requirements

         Producers and importers will develop procedures for generating
    required reports on controlled substance production/consumption levels and
    fees paid.

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                                     M-40


Operations Phase

Step 1:  Implement operational changes based on analysis of impact of fee
         Producers and importers will implement management and technical
    changes needed to meet operational changes in response to the fee system.

Step 2:  Pay fees based on production/import levels

    A.   Determine fee amounts owed

         Firms will determine the fee amount owed based on the level of
    controlled substance activity during the month covered.

    B.   Disburse fee amounts to U.S. Treasury with appropriate paperwork

         Fees will be remitted to the U.S. Treasury.  Firms will submit the
    required paperwork with the fee payment.

    C.   Notify EPA of payment

         A copy of the documentation will be sent to EPA.

Step 3:  Comply with EPA reporting and compliance monitoring requirements

    A.   Maintain records on production/consumption activities and fee payments

         Firms will maintain production/consumption and fee data needed by EPA
    to make judgments concerning compliance with the regulatory fee system.

    B.   Prepare and submit reports

         Firms will prepare and submit quarterly reports on production/
    consumption levels and fees paid.  The reports will be formatted to meet
    EPA guidelines.

    C.   Provide any additional information requested by EPA

         EPA may request additional information on production/consumption
    levels and fees paid.   Responses will be prepared and provided as needed.

    D.   Prepare for EPA site visits

         Firms will prepare for EPA site visits to ensure that all back-up
    production/consumption and fee data are available which document compliance
    with EPA requirements.

    E.   Accommodate EPA site visits

         Appropriate corporate staff will be available to EPA staff to answer
    questions during the visit.   A corporate official will meet with the EPA
    site visit team,  supply requested files, and make other individuals such as

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                                    M-41
    the production manager available as needed.  The official would interact
    with EPA on subsequent issues related to the visit.

    F.   Disburse' additional or corrected fee amounts to U.S. Treasury

         Based on EFA's evaluation of production/consumption levels and fee
    submittal reports, EPA may request additional or corrected fee amounts from
    firms.  Firms will disburse any requested fee amounts to the U.S.  Treasury
    along with required paper work.  A copy of the documentation will be sent
    to EPA.

Step 4:  Respond to any enforcement activity

    A.   Pay penalties

         Firms will respond to any enforcement activity initiated by EPA.
    Enforcement activity could include penalties for underpayment of fees.
    Steps include negotiations, preparing documentation, and payment of
    penalties.  If all firms comply with the regulation, no penalties will be
    levied.

    B.   Conduct litigation

         In some cases, enforcement activity may involve litigation.  Steps
    include negotiations,  preparing documentation, and preparing for and
    conducting litigation.  If all firms comply with the regulation, no
    litigation will be conducted.

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                                    M-42
D.  DIRECT REGULATIONS

1.  Summary of Cost Estimates

    The estimated costs associated with the direct regulations option are
detailed in Exhibit 8.  In summary form, these costs are as follows:

             Start-Up               Annual Operations       Total 1 Year Cost

EPA          $0.6 million            $23.0 million          $23.6 million
             (0.6 - contractor)      (20.9 - contractor)    (21.5 - contractor)
              0.2 FTE                32.6 FTE               32.8 FTE

Industry     $226.8 million        $122.4 million          $349.2 million


2.  Assumptions

    The analytical assumptions for the direct regulations option are as
follows:

        *(1)  The initial direct regulatory rulemaking will occur prior to
              the administrative steps analyzed here.  However, depending
              upon the results of the initial rulemaking (i.e., whether the
              targeted level of total controlled substance use is
              achieved),  EPA may have to undertake further regulations to
              impose additional controls effecting additional reductions in
              controlled substance use.  It is assumed that EPA will
              undertake formal monitoring of total controlled substance
              usage to determine whether such further regulations are
              necessary.

         (2)  The direct regulations assumed here are imposed on the uses, not
              the production or import, of controlled substances.

        *(3)  The specific direct regulations assumed are as follows:

              •     a ban on the use of regulated controlled
                    substances in blown packaging

              •     recovery and recycling of CFC-12 in
                    automobiles in large automotive shops

              •     a substantial reduction in the use of
                    controlled substances for medical
                    sterilization purposes

         (4)  The number of firms estimated to be affected by these
              regulations are:
    * Asterisks designate key assumptions which will have a significant impact
on cost estimate results.

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                                 M-43
          •     blown packaging ban:             100     (Source:  EPA)

          •     recovery and recycling
                of refrigerant in auto-
                mobile air conditioning:         20.000  (Source:  EPA)

          •     medical sterilization
                reduction:                       154     (Source:  EPA)

     (5)  Firms will have two generic types of responses to these
          regulations:

          •     substitute (in whole or in part) other chemicals
                or unregulated controlled substances for
                controlled substances used as an input in their
                product or its manufacture

          •     employ control equipment to recapture and recycle
                controlled substances used in manufacturing an
                existing product or providing an existing service

    *(6)  Compliance reporting and monitoring is presented as a quarterly
          activity for industry and EPA.

    *(7)  Based upon past EPA experience with direct regulation, it is.
          assumed that EPA enforcement activity will be greater for this
          option than for the previous economic incentive-based options.
          Consequently, cost estimates for these activities are
          significantly higher than in the other cases.

    *(8)  For industry, a full range of activities have been costed.  Some
          of these activities, however, are voluntary in nature (i.e., not
          explicitly required by the assumed control system) and will not,
          presumably, be undertaken by all firms.

The assumptions for allocation of EPA/contractor hours are as follows:

     (1)  Contractors will provide technical support to EPA, particularly
          in the start-up phase.

     (2)  EPA will direct the contractors in their support activities, and
          EPA will operate the direct regulations once they are initiated.

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                                     M-44
3.  EPA Administrative Burdens
Start-Dp Phase

Step 1:  Design reporting and compliance monitoring system for targeted
         industry applications

    A.   Design compliance plan format

         The foundation of EPA's compliance monitoring effort will be a
    standard format compliance plan.  Industry firms will use this to indicate
    to EPA what steps they plan to take to respond to the regulations.  EPA
    will design a standard format for these plans, including all information
    necessary in judging the adequacy of firms' intentions, in order to ensure
    completeness and consistency of information across all affected firms.

    B.   Develop criteria for evaluating adequacy of compliance plans

         In order to maximize objectivity and ensure consistency in the review
    of compliance plans, EPA will develop formal criteria for use in reviewing
    and commenting on the adequacy of plans submitted by firms.

    C.  Design compliance report format

         In order to allow EPA to track firms' actual compliance activities
    relative to their initial plans, firms will need to submit quarterly
    compliance reports.  EPA will design a standard format for these reports in
    order to ensure completeness and consistency of compliance information.

    D.   Develop criteria for determining the adequacy of compliance reports

         EPA will develop criteria for use in facilitating the objective and
    consistent evaluation of firms' compliance reports.

    E.   Develop policy and protocol for site visits

         In order to ensure effective monitoring of firms' compliance with
    bans/reductions, EPA will establish site visit policies and protocols.
    These policies will address the purpose of the visit, the records to be
    inspected, and the duration and timing of the visit.  Site visit schedules
    will be developed and notices prepared which will be issued to firms in
    advance of visits.

Step 2:  Design system for monitoring total use of regulated controlled
         substances

    A.   Design Section 114 letter and Federal Register Notice for obtaining
         total controlled substance use data from producers/importers

         In order to evaluate whether the selected direct regulations are
    sufficient to achieve the regulatory goal, EPA needs current information on
    total controlled substance use.  A convenient and serviceable proxy for
    this information would be information from controlled substance producers

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                                     M-45
    and importers on their sales of regulated controlled substances.  EPA would
    obtain this information through Section 114 letters and Federal Register
    Notice.  EPA will design a format for such letters to ensure adequate
    receipt of information.

    B.   Develop means of determining if additional regulations are needed

         EPA will develop criteria for use in evaluating Section 114 letters
    responses from producers and importers to determine if additional
    regulations are needed to meet the regulatory target.

    C.   Develop criteria for selecting additional control regulations

         In the event that the initial mix of direct regulations proves
    insufficient, EPA will have to identify additional regulatory steps.  In
    order to facilitate this process, EPA will develop criteria for making this
    selection in a logical and consistent manner.

Step 3:  Develop enforcement and litigation policies

         It is anticipated that enforcement and litigation will require a
    significant percentage of the resources devoted to the direct regulation
    option.  Thus, EPA will need to devote significant attention to developing
    an adequate, consistent, and fair set of enforcement and litigation
    policies.

Step 4:  Design guidelines and permitting procedures for destruction and
         permanent encapsulation of controlled substances

         Although no accepted technologies exist for destruction or permanent
    encapsulation of controlled substances, EPA will develop guidelines and
    procedures to allow for the development of these technologies.


Operations Phase


Step 1:  Receive and log compliance plans

         EPA will receive and log in firms' compliance plans.

Step 2:  Evaluate the adequacy of compliance plans

         EPA will apply the previously-developed criteria in evaluating the
    adequacy of the compliance plans submitted by affected firms.  Care will be
    taken to ensure objectivity and consistency in this process.

Step 3:  Notify firms of results of compliance plan review

         EPA will notify firms via a formal letter regarding the results of the
    review of their compliance plans.  In cases where plans are deemed
    insufficient, firms will be provided with an indication of necessary
    additional information.

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                                    M-46


Step 4:  Conduct compliance monitoring activities

    A.   Receive and log quarterly compliance reports

         EPA will receive and log in firms' quarterly compliance reports.

    B.   Evaluate adequacy of quarterly compliance reports

         Using criteria previously developed, EPA will evaluate firms'
    quarterly compliance reports.  Care will be taken to ensure objectivity and
    consistency in this process.

    C.   Notify firms of results of compliance report review

         EPA will notify firms via a formal letter regarding the results of the
    review of their quarterly compliance reports.   In cases where reports are
    deemed insufficient, firms will be provided an indication of necessary
    additional information.

    D.   Conduct site visits

         In compliance with Agency policies and protocol, EPA will conduct
    periodic site visits to monitor firms'  compliance with bans/reductions.
    Visits will be scheduled and planned in advance,  additional information (if
    needed) will be. requested and received, and all data will be compiled and
    evaluated.  A follow-up report will be sent to each firm.

Step 5:  Take enforcement action as needed

    A.   Lew penalties

         In accordance with previously developed enforcement policy,  EPA will
    review all data which indicates a violation has occurred and will take
    appropriate action, including levying penalties.   This will involve
    notifying firms of potential violations preparing documentation,  and
    calculating and negotiating penalties.

    B.   Conduct litigation
                           i
         In some cases where compliance monitoring activities indicate 'a
    violation, enforcement action may involve litigation.  This will  involve
    notifying firms of potential violations, preparing documentation,
    negotiations, and preparing for and conducting litigation.

Step 6:  Evaluate need for further reductions

    A.   Prepare and send Section 114 letters

         EPA will prepare and send the pre-designed Section 114 letter to
    controlled substance producers and importers to obtain information on total
    controlled substance use.

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                                    M-47
    B.   Receive Section 114 letters and evaluate results

         EPA will receive and evaluate the results of the Section 114 letters
    to determine whether controlled substance use targets are being met.  All
    information submitted will be handled consistent with existing 'Agency
    policy for treatment of confidential business information (CBI).
4.  Industry Administrative Burdens


Start-Dp Phase

Step 1:  Evaluate expected impact of regulations

    A.   Analyze impact of regulations

         Affected firms will conduct an analysis of the impact of the
    regulations on their operations.

    B.   Plan operational response to regulations

         Operational changes will be designed based upon firms' analysis of the
    impact of regulations.  Operational changes will vary depending upon the
    nature of regulation as well as firm-specific factors, but may include
    additional controls and input substitutions.

Step 2:  Prepare and submit compliance plan

    A.   Prepare and submit compliance plan

         Firms will prepare and submit compliance plans to EPA.

    B.   Respond to EPA requests for further information

         As needed, firms will respond to EPA requests for more information
    concerning compliance plans.

Step 3:  Design system to meet EPA reporting and compliance monitoring
         requirements

         Firms affected by both chemical substitutes and control regulations
    will develop in-house systems to track their use of controlled substances
    (regulated and non-regulated) in order to meet EPA compliance reporting
    requirements.   Internal procedures for preparing and submitting compliance
    reports will be developed.

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                                    M-48
Operations Phase


Step 1:  Comply with EPA reporting and compliance monitoring requirements

    A.   Research and compile information

         Firms will compile information on operations required by EPA as part
    of quarterly compliance reports.

    B.   Prepare and submit reports

         Firms will prepare and submit quarterly reports summarizing
    information required by EPA.  The reports will be formatted to meet EPA
   • guidelines.

    C.   Respond to requests for additional information

         As needed, firms will respond to EPA requests for more information
    concerning compliance status.

    D.   Accommodate EPA site visits

         Appropriate corporate staff  will be available to EPA staff to answer
    questions during the visit and to provide necessary assistance.  A
    corporate official will meet with the EPA site visit team, supply requested
    information, and make other individuals such as the plant manager available
    as needed.

Step 2:  Respond to any enforcement activity

    A.   Pay penalties

         Firms will respond to any enforcement activity initiated by EPA.
    Enforcement activity could include penalties for exceeding permit levels.
    Specific steps include negotiations,  documentation, and payment of
    penalties.

    B.   Conduct Litigation

         In some cases, enforcement activity may involve litigation.  Specific
    steps include negotiations,  documentation, and preparation for litigation.

Step 3:  Respond to EPA monitoring of total controlled substance use
         (producers/importers)

    A.   Research and compile information

         In order to adequately respond to EPA's request for total controlled
    substance use information, producers/importers will research and compile
    current data on controlled substance  sales levels.

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                                M-49
B.   Prepare response to Section 114 letter

     Producers/importers will prepare a response to EPA's request for
current sales levels following EPA guidelines.

C.   Send information to EPA

     Producers/importers will send the prepared response to EPA.

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                                     M-50


E.  ALLOCATED QUOTAS/REGULATORY FEES HYBRID

1.  Summary of Cost Estimates

    The estimated costs associated with the allocated quotas/regulatory fees
hybrid option are detailed in Exhibit 9.

    In summary form, these costs are as follows:

             Start-Up              Annual Operations      Total 1 Year Cost

EPA          $1.6 million          $2.8 million           $4.4 million
             (1.5 - contractor)    (1.8 - contractor)     (3.3 - contractor)
             2.2 FTE               14.8 FTE               17 FTE

Industry     $0.9 million          $2.1 million           $3.0 million

2.  Assumptions

     The analytical assumptions for the allocated quotas component of the
hybrid option are as follows:

          (1)  The total of production quotas will be allocated
               among 7 producers and approximately 14 importers
               based upon historic market share.

          (2)  Transfer of production rights among producers/
               importers will be allowed.  Transfers among different
               controlled substances will be based upon their
               relative ozone depletion potential.

          (3)  Producers and importers will keep records on
               production/import activities and submit these records
               to EPA quarterly.  Transfer activities shall be
               reported when they occur.  Exporters shall report
               exports when requesting additional consumption rights.
               Users will not be required to report activities.

         *(4)  EPA will evaluate the compliance monitoring records
               quarterly (including production/import levels and transfer
               activities) to determine whether producers or importers
               have exceeded their production/import rights.  EPA will
               also monitor activities through site visits.   A detailed
               EPA penalty policy will be developed in conjunction with
               regulations.

         *(5)  EPA will not require permitting or reporting of recycled
               controlled substances by non-producers.  Furthermore, it is
               assumed that labeling of recycled controlled substances will not
               be required.
     * Asterisks designate key assumptions which will have a significant impact
on cost estimate results.

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                                    M-51
          (6)  No accepted technologies or facilities currently exist for
               destruction or permanent encapsulation.  EPA will develop
               guidelines and permitting procedures, however, to allow for the
               development of these technologies.

     The analytical assumptions for the regulatory fees component of this
hybrid option are as follow:

          (1)  Fees will be collected from producers and importers
               only.  The amount of fees paid will be based on the
               fee level for each controlled substance type and the
               quantity of regulated controlled substance chemicals
               produced or imported.

          (2)  EPA will determine the initial fee level for each
               controlled substance type, based on its relative
               ozone-depleting potential and the initial
               regulatory goal, and develop a self-adjusting fee
               formula that will revise the fee level, as
               necessary, to recover windfall profits.

         *(3)  Producers and importers will calculate the amount of fees
               they owe and send payment to the U.S. Treasury and
               supporting data to EPA quarterly.

          (4)  Producers and importers will keep records on
               production/consumption levels, fees paid, and other
               required information and submit these records to EPA
               quarterly.

         *(5)  EPA will evaluate the compliance monitoring records quarterly
               (including production/import levels, fee payment reports, and
               other records) to ensure that the correct fee amount was
               submitted.  EPA will also monitor activities through site
               visits.  An EPA penalty policy will be developed in conjunction
               with the regulations.

         *(8)  For industry, a full range of activities have been costed.  Some
               of these activities, however, are voluntary in nature (i.e., not
               explicitly required by the assumed control system) and will not,
               presumably,  be undertaken by all firms.

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                                    M-52
3.   EPA Administrative Burdens
Start-up Phase

Step 1:   Establish production quotas and initial fee level, and refine formula
          for adjusting fee level

     A.   Calculate base year allocations based on relative shares of historic
          market

          EPA will calculate base year allocations of production and
     consumption rights for each affected firm based upon their production,
     export, and import levels, and ozone depletion weights.  EPA will record
     in detail the procedures and data used to calculate each firm-specific
     allocation.

     B.   Review available data regarding the economics of the controlled
          substance industry and historical impacts of changing controlled
          substance prices

          EPA will review available data on the economics of the controlled
     substance industry, including the historical impacts of changing
     controlled substance prices on demand and controlled substance
     production/import levels.

     C.   Review existing controlled substance model and revise as necessary to
          use in estimating appropriate fee levels

          EPA will review the existing controlled substance model to determine
     its adequacy in estimating fee levels that will capture likely windfall
     profits of producers and importers.  EPA will then make revisions to the
     controlled substance model, as necessary, so the model can be used in
     estimating appropriate fee levels.

     D.   Run model to estimate fee levels

          EPA will run the controlled substance model to estimate the
     appropriate fee levels necessary to capture windfall profits.

     E.   Finalize initial fee and self-adjusting formula contained in final
          rule

          EPA will finalize the initial fee and self-adjusting formula that
     will be outlined in the regulations.   The formula will be used to adjust
     the fee levels.

     F.   Determine schedule and procedures for periodic reassessment of the
          self-adiusting formula

          EPA will develop a schedule and procedures for reassessing the self-
     adjusting formula to ensure it adjusts the fees appropriately to capture
     windfall profits.

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                                    M-53
     G.   Notify producers/importers of final allocations of production and
          consumption Quotas. and fee levels

          EPA will formally notify each producer/importer of its allocated
     production/consumption quotas for a given year and the applicable fee
     schedule for each regulated controlled substance.  The notification will
     include an attachment describing the procedures and data used to calculate
     the allocation.  EPA will also answer any inquiries from
     producers/importers about allocations or procedures used to calculate
     allocations.

Step 2:   Design tracking and transfer systen

     A.   Design computer system

          EPA will design the computer system that will track account balances
     and transfer activities.

     B.   Design process for establishing quota accounts

          EPA will design the process for establishing an account for each firm
     representing its total allocation of rights.  EPA also will identify the
     information that must be included in each account.  The tracking system
     will be used for monitoring balances and tracking transfer transactions.

     C.   Develop procedures for reviewing and approving requests for
          consumption, production, and conversion rights, and for transfers

          EPA will design a transfer system that allows producers and importers
     to trade a portion of their annual rights to another producer or importer
     or obtain a portion of another firm's rights or from exporters.  EPA will
     first develop procedures for conducting transfer activities.  This will
     involve defining information and format that producers/importers must
     provide to EPA.

     D.   Develop tracking routine

          EPA will develop a computer routine as part of its tracking system to
     account for transfers and approval of additional rights in order to keep
     an accurate record of total rights.  The computer routine will check
     requests against available allocations and modify accounts to reflect
     changes.  If balances of rights are not sufficient to cover the request,
     the system will not approve the transaction.  EPA will then notify firms
     of approved transactions or problems with such transactions.

Step 3:   Design recordkeeping and compliance monitoring system

     A.   Develop detailed design of system

          EPA will require producers/importers to maintain daily records and
     submit quarterly reports on production/consumption levels and fees paid to
     the U.S. Treasury to monitor compliance with production/consumption
     quotas.  Fee amounts submitted will be based on the total controlled
     substances produced or imported by firms,  and the fee levels for each

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                                    M-54
     controlled substance.   EPA will establish a system for verifying that fee
     amounts submitted to the U.S.  Treasury are consistent with fee reports and
     with production and import levels.   EPA will first define the type and
     scope of information needed to ensure effective monitoring.   EPA will then
     set up a computer data base for entering information collected from site
     visits, reports, and in-house  tracking systems.  EPA will design a method
     for evaluating all monitoring  data  to identify potential violations.

     B.   Develop instructions for  obtaining information on fees paid.
          production, sales, shipments,  use of raw materials, total consumption
          rights, potential production rights, production rights, conversion
          rights. and data on recoverable and recyclable materials

          Once EPA has defined the  data  required for monitoring purposes,  it
     will develop instructions for  producers/importers to ensure that they
     understand which of the daily  records that they maintain should be
     submitted to EPA quarterly.

     C.   Develop instructions for  obtaining information on import and export
          activities

          EPA will develop instructions,  and will require importers to submit
     data quarterly on the type and quantity of substances imported, date and
     port of entry, source country, importer.of record, commodity code, total
     for that quarter and control-period-to-date of calculated levels of
     consumption rights.  Exporters who  are claiming consumption rights will be
     required to submit their EIN numbers, commodity code, the date and port of
     exit, the country to which exported, the quantities exported, and
     supporting documentation.

     D.   Determine site visit policies  (for monitoring compliance)

          In order to ensure effective monitoring of producer/importer
     compliance, EPA will establish site visit policies.  These policies will
     address the purpose of the visit, the records to be inspected, and the
     duration and timing of the visit.  Site visit schedules will be developed
     and notices prepared which will be  issued to producers/importers in
     advance of the visit.

     E.   Design operational guidelines  for the violation and penalty system

          EPA will design operational guidelines for the violation and penalty
     system prepared in conjunction with the regulation.  The guidelines will
     define the procedures in evaluating the likelihood of a possible violation
     and will outline litigation policies.  In addition, the necessary forms
     and procedures to be used by EPA will be prepared.

Step 4:   Develop guidelines and permitting procedures for destruction and
          permanent encapsulation of controlled substances

          Although no accepted technologies exist for destruction or permanent
     encapsulation of controlled substances, EPA will develop guidelines and an
     appropriate permitting process to allow for the future development of
     these technologies.

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                                    M-55
Operations Phase

Step 1:   Set up tracking system and establish accounts for all
          producers/importers

          EPA will establish an account for each producer/importer representing
     its allocation of rights.

Step 2:   Track requests for consumption, production, and conversion rights,
          and for transfers

     A.   Receive requests for transfers and additional rights

          EPA will receive and enter into the tracking system requests to
     obtain additional consumption rights, to convert potential production
     rights into production rights,  and to transfer rights to other firms.

     B.   Evaluate requests and required documentation

          The computer routine will evaluate each request against the firm's
     balance to ensure that sufficient production/import rights are available,
     If the balance is insufficient, the routine will "reject" and "flag" the
     transaction.

     C.   Examine "problem" requests and notify firms

          A small number of these transactions will be "rejected" by the
     system.  EPA will examine these problems and contact the firms involved.
     EPA may become involved in re-examining past transactions and
     investigating possible fraudulent activities to determine if enforcement
     actions are required.

     D.   Modify records

          The computer routine will modify controlled substance allocation
     records (accounts) for each firm involved to ensure accurate tracking of
     rights over time.

     E.   Notify producers/importers of approval

          EPA will notify firms via a formal letter that the requests have  or
     have not been approved and will report the "balance" of their rights.

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                                    M-56
Step 3:   Conduct compliance monitoring activities

     A.   Receive and review reports on fee payments.  production and shipments
          from plants.  use of raw materials.  total consumption rights.
          potential production rights,  production rights,  conversion rights.
          and data on recoverable and recyclable material

          EPA will receive and review quarterly reports, based on daily records
     of production activity and balances of approved rights.

     B.   Receive and review reports on import and export  activities

          EPA will receive and review quarterly import activity reports
     submitted by firms.   EPA will review export activity  reports submitted at
     the end of the year by exporters who are not claiming consumption rights.

     C.   Verify fee payment reports with U.S. Treasury records

          EPA will verify that fee payment reports are consistent with U.S.
     Treasury records.

     D.   Obtain additional information from producers/importers/exporters as
          needed

          EPA may request additional information from firms during the year on
     production/import activities and fee amount said to complete its records.

     E.   Evaluate data on production/consumption levels and fees paid to
          ensure that fees submitted reflect actual production/consumption
          levels

          EPA will review reports on production/consumption levels,  and fee
     paid,  to ensure that fees submitted reflect actual production/import
     levels.   This activity includes checking calculations made by firms on fee
     amounts owed.

     F.   Notify firms  of delinquent or incorrect fee  payments

          Based on the  evaluation of production/consumption data and fee
     amounts submitted,  EPA will issue  follow-up notices -to firms (where
     applicable) advising them to remit required fees.

     G.   Conduct site  visits to ensure production/import/export levels and fee
          payments are  consistent with records

          Site visits will be scheduled to monitor producer/importer
     recordkeeping and  controlled substance activities. During the  visit,  on-
     site records will  be examined and staff interviewed to ensure
     production/consumption levels and fee payments are consistent with
     records.

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                                    M-57
     H.   Evaluate data on production/import/export levels (from reports, in-
          house tracking systems and site visits) to ensure that firms have
          complied with their quotas

          EPA will review all data collected from production/consumption level
     reports, in-house tracking systems, and site, visits to ensure that
     producers/importers have not exceeded their approved quotas.

Step 4:   Revise self-adjusting formula as necessary

     A.   Determine if fee levels (as determined by self-adjusting formula) are
          yielding revenue to capture windfall profits and if formula needs to
          be revised

          EPA will review the levels of controlled substance revenues received
     by firms.  If revenues are excessive, EPA will revise the formula to
     capture profits.

     B.   Prepare formula revisions as necessary, based on results of analysis.
          or based on changes in regulations

          EPA will revise the self-adjusting formula if fees are not capturing
     windfall profits.

Step 5:   Take enforcement action as needed

     A.   Levy penalties

          EPA will review all data which indicates that a violation has
     occurred and will take appropriate action.  Action may include levying
     penalties.  Steps include notifying firms of potential violations,
     preparing documentation, and calculating and negotiating penalties.  If
     all firms comply with the regulations,  no penalties will be levied.

     B.   Conduct litigation

          In some cases where compliance monitoring activities indicate a
     violation, enforcement action may involve litigation.  Steps include
     notifying firms of potential violations, preparing documentation,
     negotiations, and preparing for and conducting litigation.   If all firms
     comply with the regulations, no litigation will be conducted.

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                                     M-58
4.   Industry Administrative Burdens


Start-Dp Phase

Step 1:   Evaluate expected impact of production quotas and fees on operations

     A.   Analyze impact of limits and fees

          Upon notification from EPA of official production/consumption
     allocations and fee levels, firms will conduct an analysis of the impact
     of limits and fees on operations, prices, and production options.

     B.   Plan operational response to limits and fees

          Operational changes will be designed based on firms' analysis of the
     impact of limits and fees.  Operational changes may include alterations in
     production/import levels, use of substitutes, recycling, changes in
     personnel, research and development, and financial plans.

     C.   Plan transfer and export activities

          Firms will plan anticipated transfer and export activities based on
     their analysis of the expected impact of production/import quotas.

Step 2:   Design internal fee payment system

     A.   Set up system for determining fee amount owed

          Producers and importers will develop systems for determining the fee
     amount owed based on controlled substance production or import levels.

     B.   Set up accounting system to pay correct fee amounts to U.S. Treasury

          Producers and importers will establish internal accounting systems to
     ensure timely and accurate payment of fees.

Step 3:   Design system to meet EPA reporting and compliance monitoring
          requirements

     A.   Develop in-house system to track production/consumption levels and
          fees paid

          Producers and importers will develop in-house systems to track
     production/import levels against fees paid to meet EPA compliance
     monitoring requirements.

     B.   Design reporting system to meet EPA requirements

          Producers and importers will develop procedures for generating
     required reports on controlled substance production/consumption levels and
     fees paid.

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                                    M-59
Operations Phase

Step 1:   Implement operational changes necessary to comply with regulations
          and fee system

          Producers and importers will implement management and technical
     changes needed to meet operational changes in response to the regulations
     and fee system.

Step 2:   Fay fees based on production/import levels

     A.   Determine fee amounts owed

          Firms will determine the fee amount owed based on the level of
     controlled substance activity during the quarter covered.

     B.   Disburse fee amounts to U.S. Treasury with appropriate paperwork

          Fees will be remitted to the U.S. Treasury.  Firms will submit the
     required paperwork with the fee payment.

     C.   Notify EPA of payment

          A copy of the documentation will be sent to EPA.

Step 3:   Conduct transfer transactions

     A.   Prepare and submit transfer request to EPA

          Firms will contact potential trading partners and negotiate transfers
     of portions of their allocation of rights.  They will then request EPA
     approval of the transaction according to guidelines developed by EPA.

     B.   Obtain EPA approval of transfer

          Firms will obtain a notice from EPA approving a transfer transaction.
     Firms will provide additional information to EPA, if required, to complete
     a transaction.

     C.   Modify records regarding inventory of production and consumption
          rights

          Firms will modify their records to reflect the transfer.

Step 4:   Obtain additional consumption rights through exports

     A.   Prepare and submit request and proof of exports of controlled
          substances

          A request for additional consumption rights along with the required
     export documentation must be submitted to EPA before additional rights
     will be granted.

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                                    M-60
     B.   Obtain additional consumption rights from EPA

          If the request is approved, EPA will issue a notice advising the
     party of its additional rights.

Step 5:   Convert potential production rights into production rights through
          exports to parties (additional production rights are granted through
          transactions with 25 Kilo tonne Parties)

     A.   Obtain production reduction documentation from embassy

          The embassy of the nation agreeing to reduce its allowable calculated
     level of production must provide a documentation to the recipient of the
     amount transferred and the control period covered.

     B.   Prepare and submit request and proof of exports of controlled
          substances

          A request for conversion of rights must be prepared and submitted
     with the required documentation to EPA.

     C.   Obtain notice of production rights from EPA

          If the request is approved, EPA will issue a notice advising the
     party of its additional rights.

Step 6:   Comply with EPA reporting and compliance monitoring requirements

     A.   Maintain records of fees paid, production, raw materials used,  sales.
          shipments, controlled substances recovered and recycled, and import
          and export activities

          All producers/importers will maintain copies of daily production
     records, and import and export activities.

     B.   Prepare and submit reports on fees paid, production, feedstock
          consumption, shipments, total consumption rights, potential
          production rights, production rights, conversion rights and data on
          recoverable and recyclable materials

          Firms will provide quarterly production information collected daily
     during the normal course of production.  The information will be provided
     in the firm's standard format.  In addition, fee data will be submitted in
     a format specified by EPA.

     C.   Prepare and submit reports on import and export activities

          Firms conducting import activities will provide information in an
     EPA-specified format quarterly.  Firms will report export activities when
     requesting additional consumption rights.

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                                    M-61
     D.   Provide any additional information requested by EPA

          Additional requests for production/import/export and fee data may be
     made quarterly by EPA.  Responses will be prepared and provided as needed.

     E.   Prepare for EPA site visits

          Firms will prepare for EPA site visits to ensure that all back-up
     production/import and fee data are available which document compliance
     with EPA requirements.

     F.   Accommodate EPA site visits

          Appropriate corporate staff will be available to EPA staff to answer
     questions during the visit.  A corporate official will meet with the EPA
     site visit team, supply requested files, and make other individuals such
     as the production manager available as needed.  The office would interact
     with EPA on subsequent issues related to the visit.

     G.   Disburse additional or corrected fee amounts to U.S. Treasury

          Based on EPA's evaluation of production/import levels and fee
     submittal reports, EPA may request additional or corrected fee amounts
     from firms.  Firms will disburse any requested fee amounts to the U.S.
     Treasury along with required paper work.  A copy of the documentation will
     be sent to EPA.

Step 7:   Respond to any enforcement activity

     A.   Pay penalties

          Firms will respond to any enforcement activity initiated by EPA.
     Enforcement activity could include penalties for underpayment of fees.
     Steps include negotiations, preparing documentation, and preparing for and
     conducting litigation.  If all firms comply with the regulation, no
     litigation will be conducted.

     B.   Conduct litigation

             In some cases, enforcement activity may Involve litigation.  Steps
          include negotiations, preparing documentation, and preparing for and
          conducting litigation.  If all firms comply with the regulation, no
          litigation will be conducted.

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                                     M-62


F.  ALLOCATED QUOTAS/DIRECT REGULATIONS HYBRID

1.  Summary of Cost Estimates

    The estimated costs associated with the allocated quotas/direct regulations
fees hybrid option are detailed in Exhibit 10.

    In summary form, these costs are as follows:

             Start-Up              Annual Operations      Total 1 Year Cost

EPA          $1.4 million          $24.9 million          $26.3 million
             (1.3 - contractor)    (21.8 - contractor)    (23.1 - contractor)
             1.2 FTE               45.9 FTE               47.1 FTE

Industry     $225.6 million        $123.7 million         $349.3 million


2.  Assumptions

     The analytical assumptions for the allocated quotas component of this
hybrid option are as follows:

          (1)  The total of the production quotas will be allocated among 7
               producers and approximately 14 importers based upon historic
               market share.

          (2)  Transfer of production rights among producers/ importers will be
               allowed.  Transfers among different controlled substances will
               be based upon their relative ozone depletion potential.

          (3)  Producers and importers will keep records on production/import
               activities and submit these records to EPA quarterly.  Transfer
               activities shall be reported when they occur.  Exporters shall
               report exports when requesting additional consumption rights.
               Users will not be required to report activities.

         *(4)  EPA will evaluate the compliance monitoring records quarterly
               (including production/import levels and transfer activities) to
               determine whether producers or importers have exceeded their
               allocation of production/import rights.  EPA will also monitor
               activities through site visits.  A detailed EPA penalty policy
               will be developed in conjunction with the regulations.

         *(5)  EPA will not require permitting or reporting of recycled
               controlled substances by non-producers.  Furthermore, it is
               assumed that labeling of recycled controlled substances will not
               be required.
     * Asterisks designate key assumptions which will have a significant impact
on cost estimate results.

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                                    M-63
          (6)  No accepted technologies or facilities currently exist for
               destruction or permanent encapsulation.   EPA will develop
               guidelines and permitting procedures, however,  to allow for the
               development of these technologies.

The analytical assumptions for the direct regulations component or this hybrid
option are as follows:

        *(1) The direct regulations assumed here are imposed on the uses, not
             the production or import, of controlled substances.

        *(2) The specific direct regulations assumed are as follows:

             • a ban on the use of regulated controlled substances in
               blown packaging

             • recovery and recycling of CFC-12 in automobiles in
               large automotive shops

        *(3) The number of firms estimated to be affected by these regulations
             is:

             • blown packaging ban:                    100    (Source:  EPA)

             • recovery and recycling of
               refrigerant in automobile
               air conditioning:                       20.OOP (Source:  EPA)

         (4) Firms will have two generic types of responses to these
             regulations:

             • substitute (in whole or in part) other chemicals or
               unregulated controlled substances for controlled
               substances used as an input in their product or its
               manufacture

             • employ control equipment to recapture and recycle
               controlled substances used in manufacturing an
               existing product or providing an existing service

         *(5)  Compliance reporting and monitoring is presented as a quarterly
               activity for industry and EPA.
                            i
         *(6)  Based upon past EPA experience, it is assumed that EPA
               enforcement costs associated with direct regulation will be
               significantly higher than for allocated quotas and that the
               total enforcement effort associated with this option will be
               greater than for the three economic incentives-based options.

         *(7)  For industry, a full range of activities have been costed.  Some
               of these activities, however, are voluntary in nature (i.e., not
               explicitly required by the assumed control system) and will not,
               presumably, be undertaken by all firms.

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                                    M-64
     The assumptions for allocation of EPA/contractor hours are as follows:

          (1)  Contractors will provide technical support to EPA, particularly
               in the start-up phase.

          (2)  EPA will direct the contractors in their support activities and
               in operating the hybrid system once it is developed.


3.  EPA Administrative Burdens


Start-Up Phase

Step 1:  Establish production quotas

    A.    Calculate base year allocations based on relative shares of historic
         market

         EPA will calculate base year allocations of production and consumption
    rights for each affected firm based upon their production,  import, and
    export levels, and ozone depletion weights.  EPA will record in detail the
    procedures and data used to calculate each firm-specific allocation.


    B.    Notify producers/importers of final allocations of production quotas

         EPA will formally notify each producer/importer of its allocated
    production/consumption quotas for a given year.  The notification will
    include an attachment describing the procedures and data used to calculate
    the allocation.   EPA will also answer any inquiries from
    producers/importers about allocations or procedures used to calculate
    allocations.

Step 2:  Design tracking and transfer system

    A.    Design computer system

         EPA will design the computer system that will track account balances
    and transfer activities.

    B.    Design process for establishing quota accounts

         EPA will design the process for establishing an account for each firm
    representing its total allocation of rights.   EPA also will identify the
    information that must be included in each account.  The tracking system
    will be used for monitoring balances and tracking transfer  transactions.

    C.    Develop procedures for reviewing and approving requests for
         consumption,  production, and conversion rights, and for transfers

         EPA will design a transfer system that allows producers and importers
    to  trade a portion of their annual rights to another producer or importer
    or  obtain a portion of another firm's rights.   EPA will first develop

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                                    M-65
    procedures for conducting transfer activities.   This will involve defining
    information and format that producers/importers must provide to EPA.

    D.   Develop tracking routine

         EPA will develop a computer routine as part of its tracking system to
    account for transfers and approval of additional rights in order to keep an
    accurate record of total rights.  The computer routine will check requests
    against .available allocations and modify accounts to reflect changes.   If
    balances of rights are not sufficient to cover the request, the system will
    not approve the transaction.  EPA will then notify firms of approved
    transactions or problems with such transactions.

Step 3:  Design recordkeeping and compliance monitoring system

    A.   Develop detailed design of system

         EPA will require producers/importers to maintain daily records and
    submit quarterly reports on production/consumption levels to monitor
    compliance with production/consumption rights.   EPA will first define the
    type and scope of information needed to ensure effective monitoring.   EPA
    will then set up a computer data base for entering information collected
    from site visits, reports, and in-house tracking systems.  EPA will design
    a method for evaluating all monitoring data to identify potential
    violations.

    B.   Develop instructions for preparation of information on production.
         sales,  shipments, use of raw materials, total consumption rights.
         potential production rights, production rights, conversion rights, and
         data on recoverable and recyclable materials

         Once EPA has defined the data required for monitoring purposes,  it
    will develop instructions for producers/importers to ensure that they
    understand which of the daily records that they maintain should be
    submitted to EPA quarterly.

    C.   Develop instructions for obtaining information on import and export
         activities

         EPA will develop instructions, and will require importers to submit
    data quarterly on the type and quantity of substances imported, date and
    port of entry, source country, importer of record, total for that quarter
    and control-period-to-date of calculated levels of consumption rights.
    Exporters who are claiming consumption rights will be required to submit
    their EIN numbers, commodity code, the date and port of exit, the country
    to which exported, the quantities exported, and supporting documentation.

    D.   Determine site visit policies (for monitoring compliance)

         In order to ensure effective monitoring of producer/importer
    compliance,  EPA will establish site visit policies.  These policies will
    address the purpose of the visit, the records to be inspected, and the
    duration and timing of the visit.   Site visit schedules will be developed

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                                    M-66
    and notices prepared which will be issued to producers/importers in advance
    of the visit.

    E.   Design operational guidelines for the violation and penalty system

         EPA will design operational guidelines for the violation and penalty
    system prepared in conjunction with the regulation.  The guidelines will
    define a violation and potential penalty levels and will outline litigation
    policies.  In addition, the necessary forms and procedures to be used by
    EPA will be prepared.

    F.   Design compliance plan format

         The foundation of EPA's compliance monitoring effort will be a
    standard format compliance plan.  Industry firms will use this to indicate
    to EPA what steps they plan to take to respond to the regulations.  EPA
    will design a standard format for these plans, including all information
    necessary in judging the adequacy of firms' intentions, in order to ensure
    completeness and consistency of information across all affected firms.

    G.   Develop criteria for evaluating adequacy of compliance plans

         In order to maximize objectivity and ensure consistency in the review
    of compliance plans, EPA will develop formal criteria for use in reviewing
    and commenting on the adequacy of plans submitted by firms.

    H.   Design compliance report format

         In order to allow EPA to track firms' actual compliance activities
    relative to their initial plans, firms will need to submit quarterly
    compliance reports.   EPA will design a standard format for these reports in
    order to ensure completeness and consistency of compliance information.

    I.   Develop criteria for determining adequacy of compliance reports

         EPA will develop criteria for use in facilitating the objective and
    consistent evaluation of firms' compliance reports.

    J.   Develop policy and protocol for site visits

         In order to ensure effective monitoring of firms' compliance with
    bans/reductions, EPA will establish site visit policies and protocols.
    These policies will address the purpose of the visit, the records to be
    inspected, and the duration and timing of the visit.  Site visit schedules
    will be developed and notices prepared which will be issued to firms in
    advance of visits.

Step 4:  Develop enforcement and litigation policies

         It is anticipated that enforcement and litigation will require a
    significant percentage of the resources devoted to the direct regulation
    option.  Thus, EPA will need to devote significant attention to developing
    an adequate, consistent, and fair set of enforcement and litigation
    policies.

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                                    M-67
Step 5:  Design guidelines and permitting procedures for destruction and
         permanent encapsulation of controlled substances

         Although no accepted technologies exist for destruction or permanent
    encapsulation of controlled substances, EPA will develop guidelines and
    procedures to allow for the development of these technologies.
Operations Phase


Step 1:  Receive and log compliance plans

         EPA will receive and log in firms'  compliance plans.

Step 2:  Evaluate the adequacy of compliance plans

         EPA will apply the previously-developed criteria in evaluating the
    adequacy of the compliance plans submitted by affected firms.  Care will be
    taken to ensure objectivity and consistency in this process.

Step 3:  Notify firms of results of compliance plan review

         EPA will notify firms via a formal  letter regarding the results of the
    review of their compliance plans.   In cases where plans are deemed
    insufficient, firms will be provided an  indication of necessary additional
    information.

Step 4:  Set up tracking system and establish accounts for all
         producers/importers

    A.   Establish accounts for all producers/importers

         EPA will establish an account for each producer/importer representing
    its allocation of rights.

Step 5:  Track requests for consumption, production, and conversion rights, and
         for transfers

    A.   Receive requests for transfers and  additional rights

         EPA will receive and enter into the tracking system requests to obtain
    additional consumption rights,  to  convert potential production rights into
    production rights, and to transfer rights to other firms.

    B.   Evaluate requests and required documentation

         The computer routine will evaluate  each transfer request against the
    firm's records to ensure that sufficient controlled substance rights are
    available.  If account balances are insufficient,  the routine will "reject"
    and "flag" the transaction.

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                                     M-68
    C.   Examine "problem" requests and notify

         A small number of these transactions will be "rejected" by the system.
    EPA will examine these problems and notify firms involved.    EPA may become
    involved in re-examining past transactions and investigating possible
    fraudulent activities to determine if enforcement actions are required.

    D.   Modify records

         The computer routine will modify controlled substance allocation
    records (accounts) for each firm involved to ensure accurate tracking of
    rights over time.

    E.   Notify producers/importers of approval

         EPA will notify firms via a formal letter that the requests have or
    have not been approved and will report the "balance" of their rights.

Step 6:  Conduct compliance monitoring activities

    A.   Receive and review reports on production and shipments from plants.
         use of raw materials, total consumption rights, potential production
         rights, production rights, conversion rights,  and data on recoverable
         and recyclable material

         EPA will receive and review quarterly reports  based on daily records
    of production activity and balances of approved rights.

    B.   Receive and review reports on import and export activities

         EPA will receive and review quarterly import activity reports
    submitted by firms.  EPA will review export activity reports submitted at
    the end of the year by exporters who are not claiming consumption rights.

    C.   Obtain additional information from producers/importers as needed

         EPA may request additional information from firms during the year on
    production/import/export activities to complete its records.

    D.   Conduct site visits to ensure production/import/export activities are
         consistent with records

         EPA will conduct periodic site visits to monitor reporting procedures.
    Visits will be scheduled and planned in advance, and a follow-up report
    will be sent to the firm.

    E.   Evaluate data on production/lmport/export levels (from reports.
         in-house tracking systems, and site visits) to ensure that firms have
         complied with their limits

         EPA will review all data collected from production/import level
    reports, in-house tracking systems, and site visits to ensure that
    producers/importers have not exceeded their approved rights.

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                                    M-69


    F.    Receive and log quarterly compliance reports from users

         EPA will receive and log in firms'  quarterly compliance reports.

    G.    Evaluate adequacy of compliance reports

         Using criteria previously developed, EPA will evaluate firms'
    quarterly compliance reports.  Care will be taken to ensure objectivity and
    consistency in this process.

    H.    Notify firms of results  of compliance report review

         EPA will notify firms via a formal letter regarding the results of the
    review of their quarterly compliance reports.  In cases where reports are
    deemed insufficient firms will be provided with and indication of necessary
    additional information.

    I.    Conduct site visits

         In compliance with Agency policies and protocol, EPA will conduct
    periodic site visits to monitor firms'  compliance with bans/reductions.
    Visits will be scheduled and  planned in advance, additional information (if
    needed) will be requested and received,  and all data will be compiled and
    evaluated.  A follow-up report will be  sent to each firm.

Step 7:  Take enforcement action as needed

    A.    Levy penalties

         In accordance with previously-developed enforcement policy, EPA will
    review all data which indicates a violation has occurred and will take
    appropriate action, including levying penalties.  This will involve
    notifying firms of potential  violations, preparing documentation, and
    calculating and negotiating penalties.   If all firms comply with the
    regulations, penalties will not be levied.

    B.    Conduct litigation

         In some cases where compliance monitoring activities indicate a
    violation, enforcement action may involve litigation.  This will involve
    notifying firms of potential  violations, preparing documentation,
    negotiations, and preparing for and conducting litigation.   If all firms
    comply with the regulations,  litigation will not be conducted.

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                                    M-70
4.  Industry Administrative Burdens


Start-Up Phase

Step 1:  Evaluate expected impact of production quotas and regulations

    A.   Analyze impact of limits

         Upon notification from EPA of official production/consumption
    allocations, firms will conduct an analysis of the impact of limits on
    operations, prices, and production options.

    B.   Plan operational response to limits

         Operational changes will be designed based on firms' analysis of the
    impact of limits. Operational changes may include alterations in
    production/consumption levels, use of substitutes, recycling, changes in
    personnel, research and development, and financial plans.

    C.   Plan transfer and export activities

         Firms will plan anticipated trading activities based on their analysis
    of the expected impact of allocated rights.

    D.   Analyze impact of regulations

         Affected firms will conduct an analysis of the impact of the
    regulations on their operations.

    E.   Plan operational response to regulations

         Operational changes will be designed based upon firms' analysis of the
    impact of regulations.  Operational changes will vary depending upon nature
    of regulation as well as firm-specific factors, but may include additional
    controls, input substitutions, and product changes.

Step 2:  Prepare and submit compliance plan

    A.   Prepare and submit compliance plan

         Firms will prepare and submit compliance plans to EPA.

    B.   Respond to EPA requests for further information

         As needed, firms will respond to EPA requests for more information
    concerning compliance plans.

Step 3:  Design system to meet EPA reporting and compliance monitoring
         requirements

         Firms affected by both ban/reduction and control regulations will
    develop in-house systems to track their use of controlled substances
    (regulated and non-regulated) in order to meet EPA compliance reporting

-------
                                    M-71

                                            i
    requirements.  Internal procedures for preparing and submitting compliance
    reports will be developed.


Operations Phase

Step 1:  Implement operational changes necessary to comply with regulations

Step 2:  Conduct transfer transactions

    A.   Prepare and submit transfer requests to EPA

         Firms will contact potential trading partners and negotiate portions
    of their allocations of rights.  They will then request EPA approval of the
    transaction according to guidelines developed by EPA.

    B.   Obtain EPA approval of transfer

         Firms will obtain a notice from EPA approving a transfer transaction.
    Firms will provide additional information to EPA, if required, to complete
    a transaction.

    C.   Modify records

         Firms will modify their records to reflect the transfer.

Step 3:  Obtain additional consumption rights through exports

    A.   Prepare and submit request and proof of exports of controlled
         substances

         A request for additional consumption rights along with the required
    export documentation must be submitted to EPA before additional rights will
    be granted.

    B.   Obtain additional consumption rights from EPA

         If the request is approved, EPA will issue a notice advising the party
    of its additional rights.

Step 4:  Convert potential production rights into production rights through
         exports to parties (additional production rights are granted through
         transactions with 25 Kilotonne Parties)

    A.   Obtain production reduction documentation from embassy

         The embassy of the nation agreeing to reduce its allowable calculated
    level of production must provide documentation to the recipient of the
    amount transferred and the control period covered.

-------
                                    M-72
    B.   Prepare and submit request and proof of exports of controlled
         substances

         A request for conversion of rights must be prepared and submitted with
    the required documentatibn to EPA.

    C.   Obtain notice of production rights from EPA

         If .the request is approved, EPA will issue a notice advising the party
    of its additional rights.

Step 5:  Comply with EPA reporting and compliance monitoring requirements

    A.   Maintain records of production,  raw materials purchased,  sales.
         process parameters, and import and export activities

         All  producers/importers will maintain copies of daily production
    records,  and import and export activities.

    B.   Prepare and submit reports on production,  feedstock consumption.
         shipments, total consumption rights,  potential production rights.
         production rights, conversion rights,  and data on recoverable and
         recyclable materials

         Firms will provide quarterly information collected daily during the
    normal course of production.  The information will be provided in the
    firms' standard format.

    C.   Prepare and submit reports on import and export activities

         Firms conducting import activities will provide information in an EPA-
    specified format quarterly.   Firms  will report export activities when
    requesting additional consumption rights.

    D.   Provide any additional  information requested by EPA

         Additional requests for production/import/export data may be made
    quarterly by EPA.  Responses will be prepared and provided as  needed.

    E.   Users research and compile information on controlled substance use

         Firms affected by direct regulations will compile information on
    operations required by EPA as part of quarterly compliance reports.

    F.   Users prepare .and submit reports

         Firms affected by direct regulations will prepare and submit reports
    summarizing information required by EPA.   The reports will be  formatted to
    meet EPA  guidelines.

    G.   Users provide additional information requested bv EPA

         Additional requests for controlled substance use information may be
    made quarterly by EPA.  Responses will be prepared and provided as needed.

-------
                                     M-73
   -H.   Prepare for EPA site visits

         Firms will prepare for EPA site visits to ensure that all back-up
    production/import data are available which document compliance with EPA
    requirements.

    I.   Accommodate EPA site visits

         Appropriate corporate staff will be available to EPA staff to answer
    questions during the visit.  A corporate official will meet with the EPA
    site visit team, supply requested files, and make other individuals such as
    the production manager available as needed.  The official would interact
    with EPA on subsequent issues related to the visit.

Step 6:  Respond to any enforcement activity

    A.   Pay penalties

         Firms will respond to any enforcement activity initiated by EPA.
    Enforcement activity could include penalties for exceeding approved rights.
    Specific steps include negotiations, documentation, and payment of
    penalties.  If all firms comply with the regulation, no penalties will be
    levied.

    B.   Conduct litigation

         In some cases, enforcement activity may involve litigation.   Specific
    steps include negotiations, documentation, and preparation for litigation.
    If all firms comply with the regulation, no litigation will be conducted.

-------
                                                                                              EXHIBIT 5

                                                                                              CFC CONTROL OPTIONS
                                                                                              Auctioned Rights
                                                                                              EPA Administrative Burdens
                                  ACTIVITIES
                                                                                                                 B
                       EPA

                        C
                                                                                               NUMBER OF        EPA       TOTAL      TOTAL
                                                                                              OCCURRENCES    HOURS PER     EPA        EPA
                                                                                               PER YEAR     OCCURRENCE    HOURS     DOLLARS
                                                                                                                       (C=A*B)[al (DsC*$30.4S)[bl
           CONTRACTOR

     E          F          G

CONTRACTOR    TOTAL      TOTAL
 HOURS PER CONTRACTOR CONTRACTOR
OCCURRENCE    HOURS     DOLLARS
           (F=A*E)tc) 
-------
                                                                                              EXHIBIT 5 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Auctioned Rights
                                                                                              EPA Administrative Burdens
                                  ACTIVITIES
     Track Requests  for  Consumption, Production, and Conversion Rights,
     and for Transfers
     A.    Receive requests  for transfers and additional rights
     B.    Evaluate requests and required documentation
     C.    Examine "problem" requests and notify firms
     D.    Modify records
     E.    Notify producers/importers/exporters of approval
                                                                               3.SUBTOTAL
4.   Conduct Compliance Monitoring Activities
     A.   Receive end review reports on production and shipments, use of
          raw materials, total consumption  rights, potential production rights,
          production rights, conversion rights, and data on recoverable and
          recyclable material
     B.   Receive and review reports on import and export activities
     C.   Obtain additional  information from producers/importers/exporters as
          ___j_-j
     D.   Conduct site visits to ensure production/import/export activities are
          consistent with records
               Schedule site visits
               Plan site visit activities
               Conduct site  visits
     E.   Evaluate data on production/inport/export  levels (from reports,
          in-house tracking  systems, and  site visits) to ensure that firms have
          complied with their limits.   Examine  import/export records; reconcile
          differences; account  for destruction

A
NUMBER OF
OCCURRENCES
PER YEAR

3123.00
3123.00
625.00
3123.00
3123.00

84.00
84.00
42.00
28.00



84.00

B
EPA
HOURS PER
OCCURRENCE

[k] 0.5

[I] 8
0.1
1

[ml 8
[ml 4
[n] 20
Co] 60
12
16
32
[pi 32
EPA
C
TOTAL
EPA
HOURS

-------
                                                                                              EXHIBIT 5 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Auctioned Rights
                                                                                              EPA Administrative Burdens
                                  ACTIVITIES
5.   Take Enforcement Action as  Needed
     A.   Levy penalties (includes notification, documentation, calculations,
          and negotiations)
     B.   Conduct litigation (includes  notification, documentation, calculations,
          end preparation for litigation)
                                                                               5.SUBTOTAL

                                                  TOTAL EPA OPERATIONS
                                                  TECHNICAL AND ADMINISTRATIVE SUPPORT [s]
                                                  TRAVEL COSTS
                                                  TOTAL EPA OPERATIONS (including travel and support costs)

                                                  TOTAL EPA START-UP AND OPERATIONS
                                                  TOTAL EPA FTE (HOURS/2080)

A B
NUMBER OF EPA
OCCURRENCES HOURS PER
PER YEAR OCCURRENCE
2.00 [q] 160
1.00 [r] 2,080

support costs)

EPA
C
TOTAL
EPA
HOURS
(C=A*B)[a]
320
2,080
2.400
41,252
11,103
52,355
56,331
27.08

D
TOTAL
EPA
DOLLARS
(DsC*S30.45)lbl
9,744
63,336
(73,080
SI, 256, 117
1338,086
S14.840 [t]
SI, 609,043
SI, 730,113
CONTRACTOR
E F, G
CONTRACTOR TOTAL TOTAL
HOURS PER CONTRACTOR CONTRACTOR
OCCURRENCE HOURS DOLLARS

-------
                                                                                              EXHIBIT S (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Auctioned Rights
                                                                                              Industry Administrative Burdens
                                   ACTIVITIES
START-UP PHASE
1.   Provide EPA with Five Year Historic Use Levels in Response to Section 1U
     Letters
     A.   Research and compile information
     B.   Prepare response to Section 114 letter
     C.   Send information to EPA


2.   Evaluate Expected Impact of Production/Consumption Rights on Operations
     A.   Analyze impact of limits
     B.   Plan operational response to Units
     C.   Plan transfer and export activities
                                                   TOTAL INDUSTRY START-UP
OPERATIONS PHASE
1.   Inplement Operational Changes Necessary to Comply with Regulations


2.   Respond to Bid Solicitation
     A.   Conduct market analysis to determine bidding price and rights for
          which to bid
     B.   Prepare bid
     C.   Send bid to EPA
3.   Obtain Rights
     A.   Review bid results
     B.   Send payment for awarded rights
4.   Evaluate Expected Impact of System
     A.   Analyze impact of rights obtained
     B.   Decide whether to transfer rights obtained
1.SUBTOTAL
                                                                                2. SUBTOTAL
1.SUBTOTAL
                                                                                3.SUBTOTAL
                                                                                3.SUBTOTAL
                                                                                4. SUBTOTAL

A
NUMBER OF
OCCURRENCES
PER YEAR
1.00
1.00
1.00

1.00
1.00
1.00


1.00

1.00
1.00
1.00

1.00
1.00

1.00
1.00

B
PRODUCER
HOURS PER
OCCURRENCE
[1] 0
0
0

160
400
160


320

[jl 120
24
2

Ik] 2
8

[11 120
80
PRODUCER
C
TOTAL
PRODUCER
HOURS
(C=A*B*7)[al
0
0
0
0
1.120
2,800
1.120
5.040
5,040
2,240
2,240
840
168
14
1,022
14
56
70
840
560

D
TOTAL
PRODUCER
DOLLARS
(0=C«$50) [b]
0
0
0
SO
56.000
140.000
56.000
S252.000
S252.000
112.000
$112,000
42.000
8.400
700
$51.100
700
2.800
S3.500
42.000
28.000

E
IMPORTER
HOURS PER
OCCURRENCE
0
0
0

80
200
80


200

80
24
2

2
8

2
2
IMPORTER
F
TOTAL
IMPORTER
HOURS
(F=A*E*14)(Cl
0
0
0
0
1,120
2,800
1,120
5,040
5.040
2,800
2,800
1,120
336
28
1,484
28
112
140
28
28

G
TOTAL
IMPORTER
DOLLARS
(G=F*J50) [dl
0
0
0
SO
56,000
140,000
56,000
$252,000
(252,000
140,000
(140,000
56.000
16.800
1,400
(74,200
1,400
5,600
(7,000
1,400
1.400
                                                                                                                                  t.400
                                                               (70.000
                                                                                                                                                                                         56
                                                                                                                                                                                                  (2,800

-------
                                                                                              EXHIBIT S (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Auctioned Rights
                                                                                              Industry Administrative Burdens
                                  ACTIVITIES
5.   Evaluate Operations Plan
     A.   Determine impact of rights obtained on operations
     B.   Implement changes in operations


6.   Conduct Transfer Transactions
     A.   Prepare and submit transfer request to EPA
     B.   Obtain EPA approval for transfer
     C.   Modify records regarding inventory of  production and consumption
          rights


7.   Obtain Additional Consumption Rights through Exports
     A.   Prepare and submit request and proof of exports of  controlled
          substances
     B.   Obtain additional consumption rights from EPA


B.   Convert Potential Production Rights into Production Rights through  Exports
     to Parties (Additional Production Rights are Granted through  Transactions
     with 25 Kilotome Parties)
     A.   Obtain production reduction documentation from embassy
     B.   Prepare and submit request and proof of exports of  controlled
          substances
     C.   Obtain notice of production rights from EPA
5. SUBTOTAL
6.SUBTOTAL
7.SUBTOTAL
                                                                                8. SUBTOTAL

A
NUMBER OF
OCCURRENCES
PER YEAR
1.00
1.00

1.00
1.00
1.00

1.00
1.00

1.00
1.00
1.00


B
PRODUCER
HOURS PER
OCCURRENCE
80
160

Cm] 5
1

In] 5
2

[o] 40
40
2

PRODUCER
C
TOTAL
PRODUCER
HOURS
(C=A*B*7) [a]
560
1.120
1.680
35
14
7
56
35
14
49
280
280
14
574

D
TOTAL
PRODUCER
DOLLARS
(D=C*$50)[b]
28.000
56.000
184.000
1,750
700
350
S2.800
1.750
700
S2.450
14.000
14.000
700
428,700

E
IMPORTER
HOURS PER
OCCURRENCE
40
80

5
2
1

5
2

40
40
2

IMPORTER
F
TOTAL
IMPORTER
HOURS
(F=A*E*14)lcl
560
1.120
1.680
70
28
14
112
70
28
98
560
560
28
1,148

G
TOTAL
IMPORTER
DOLLARS

-------
                                                                                              EXHIBIT 5 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Auctioned Rights
                                                                                              Industry Administrative Burdens
                                   ACTIVITIES
5.   Evaluate Operations Plan
     A.   Determine Impact of rights obtained on operations
     B.   Implement changes in operations


6.   Conduct Transfer Transactions
     A.   Prepare and submit transfer request to EPA
     B.   Obtain EPA approval for transfer
     C.   Kodify records regarding inventory of production and consumption
          rights


7.   Obtain Additional Consumption Rights through Exports
     A.   Prepare and submit request and proof of exports  of  controlled
          substances
     B.   Obtain additional consumption rights from EPA


8.   Convert Potential Production Rights into Production Rights through Exports
     to Parties (Additional Production Rights are Granted  through  Transactions
     with 25 Kilotome Parties)
     A.   Obtain production reduction documentation from embassy
     B.   Prepare and submit request and proof of exports  of  controlled
          substances
     C.   Obtain notice of production rights from EPA
5.SUBTOTAL
6.SUBTOTAL
/.SUBTOTAL
                                                                                8.SUBTOTAL

H
OTHER
PARTIES
HOURS PER
OCCURRENCE
40
80

5
2
1

5
2

40
40
2

OTHER
1
TOTAL
OTHER
PARTIES[e]
2.060
2.060

2,060
2,060
2,060

2,060
2,060

500
500
500

PARTIES
J
TOTAL OTHER
PARTIES
HOURS
(J=A«H*l)tfJ
82,400
164,800
247,200
bid 10,300
4.120
2.060
16.480
In] 10.300
4,120
14.420
[ol 20.000
20.000
1,000
41.000

K
TOTAL OTHER
PARTIES
DOLLARS
(K=J"»SO)[gl
4,120.000
8,240.000
$12. 360,000
515,000
206,000
103,000
$824,000
515,000
206,000
1721,000
1.000,000
1.000,000
50.000
$2,050,000
TOTAL
L
TOTAL
INDUSTRY
COST
UO+G+KMh]
4,176.000
8,352,000
$12,528,000
520.250
208.100
104.050
$832.400
520,250
208,100
S728.350
1,042,000
1,042,000
52,100
$2,136,100

-------
                                  ACTIVITIES
                                                                                              EXHIBIT 5 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Auctioned Rights
                                                                                              Industry Administrative Burdens
                                                                                                                 OTHER PARTIES

                                                                                                                 I             J
                                                                                                   H
                                                                                                 OTHER         TOTAL
                                                                                                PARTIES        OTHER
                                                                                               HOURS PER    PARTIES [el
                                                                                              OCCURRENCE
                                                                                                                      TOTAL  OTHER  TOTAL OTHER
                                                                                                                        PARTIES      PARTIES
                                                                                                                         HOURS       DOLLARS
                                                                                                                      
-------
                                                                                              EXHIBIT 5 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Auctioned Rights
                                                                                              Industry Administrative Burdens
                                   ACTIVITIES
                                                                                               NUMBER OF     PRODUCER
                                                                                              OCCURRENCES    HOURS PER
                                                                                               PER YEAR     OCCURRENCE
                        PRODUCER

                            C

                          TOTAL
                        PRODUCER
                          HOURS
                      CC=A«B*7)[a]
                            TOTAL
                           PRODUCER
                           DOLLARS
                         (D=C**50)tb)
                                               IMPORTER

                                    E              F            G

                                IMPORTER         TOTAL        TOTAL
                                HOURS PER      IMPORTER     IMPORTER
                               OCCURRENCE        HOURS       DOLLARS
                                             
-------
                                                                                               EXHIBIT S  (CONTINUED)

                                                                                               CFC CONTROL OPTIONS
                                                                                               Auctioned  Rights
                                                                                               Industry Administrative Burdens
                                   ACTIVITIES
START-UP PHASE
1.   Provide EPA with Five Tear Historic Use Levels in Response to Section 114
     Letters
     A.   Research and compile information
     B.   Prepare response to Section t14 letter
     C.   Send information to EPA


2.   Evaluate Expected Impact of Production/Consumption Rights on Operations
     A.   Analyze impact of limits
     B.   Plan operational response to limits
     C.   Plan transfer and export activities
                                                   TOTAL INDUSTRY START-UP
OPERATIONS PHASE
1.   Implement Operational Changes Necessary to Comply with Regulations


2.   Respond to Bid Solicitation
     A.   Conduct market analysis to determine bidding price and rights for
          which to bid
     B.   Prepare bid
     C.   Send bid to EPA
3.   Obtain Rights
     A.   Review bid results
     B.   Send payment for awarded rights
4.   Evaluate Expected Impact of System
     A.   Analyze impact of rights obtained
     B.   Decide whether to transfer rights obtained
1.SUBTOTAL
                                                                                2.SUBTOTAL
1.SUBTOTAL
                                                                                2.SUBTOTAL
                                                                                3.SUBTOTAL
                                                                                4.SUBTOTAL

H
OTHER
PARTIES
HOURS PER
OCCURRENCE
20
20
2

80
200
BO

200

40
24
i

2
a

5
5
OTHER
1
TOTAL
OTHER
PARTIESIe]
140
140
140

2,060
2,060
2,060

2.060

2,060
2,060
2,060

500
500

2,060
2,060
PARTIES
J
TOTAL OTHER
PARTIES
HOURS
(J=A«HM)[fl
2.800
2.800
280
5.680
164.800
412.000
164.800
741.600
747.480
412.000
412.000
[jl 82.400
49.440
4.120
135.960
[k] 1,000
4.000
5.000
[11 10.300
10.300

K
TOTAL OTHER
PARTIES
DOLLARS
(K=J*$50) [g]
140,000
140,000
14.000
$294,000
8,240.000
20,600.000
8,240.000
$37,080.000
=s=s====== ===========
S37.374.000
20.600.000
S20.600.000
4.120.000
2,472.000
206.000
S6, 798. 000
50.000
200,000
S250.000
515,000
515,000
TOTAL
L
TOTAL
INDUSTRY
COST

-------
                                   EXHIBIT 5

                                AUCTIONED RIGHTS
                           EPA ADMINISTRATIVE BURDENS
                                   FOOTNOTES

a/
   Total EPA Hours represents  the Number of Occurrences per year x EPA Hours per
   Occurrence.   (C — AxB)

b/
   Total EPA Dollars represents Total EPA hours x $30.45.  $30.45 represents the
   hourly rate of pay of a government employee at Grade 10, step 7, which is
   $14.50 per hour, and an overhead rate of 110 percent.  Source:  EPA Appendix
   D.28.1:  Preparing Information Collection Requests.  (D - Cx$30.45)

£/
   Total Contractor Hours represents the Number of Occurrences per year x
   Contractor Hours per Occurrence.  (F => AxE)

d/
   Total Contractor Dollars represents Total EPA Hours x $50.00.  $50.00
   represents an average hourly rate of pay for a contractor.  (G = Fx$50.00)

&
   Total Agency Costs represents the sum of Total EPA Dollars and Total
   Contractor Dollars.  (H = D+G)

£/
   A sample of two percent (140) of the first line buyers will be surveyed in
   addition to the 21 producers/importers.

£/
   Hours for evaluating bids assumes EPA will receive 2,080 bids.  This assumes
   20 percent of the 7,000 first line buyers will bid, 2 percent of the
   approximately 33,000 other parties will bid, and all 21 producers and
   importers will bid.  Hence, (.2 x 7,000) + (.02 x 33,000) +21-2,081.  It
   will take EPA slightly more than one hour to receive and evaluate each bid.
   It will take a contractor approximately between 1.5 and 2.0 hours to receive
   and evaluate each bid (assuming that some bids may not follow established
   procedures).

h/
   Hours for notifying bidders of results assumes all bidders (successful and
   unsuccessful) will be notified; all producers and importers (21) and 50
   percent of all other bidders (or approximately 500) will be successful for a
   total of 521.

I/
   Establishing accounts for successful bidders assumes there will be 521
   successful bidders (producers, importers,  and other parties).

I/
   Establishing accounts for new entrants assume there will be 500 new entrants.

-------
                                     -2-
   The number of requests for transfers and additional rights assumes that the
   producers and importers (21) and an additional 500 parties will choose to
   conduct such transactions three times per year, and that 30 exporters will
   request, receive, and subsequently trade, consumption rights weekly to
   producers/importers for a total of 3,123 requests.  Hence, (3 x 21) + (3 x
   500) + (30 x 52) = 3,123 requests to be processed.

I/
   The number of problem requests assumes 20 percent of the requests will be
   flagged as problems.

ffl/
   Number of reports on production/import/export activities assumes that the 21
   producers and importers will submit reports quarterly.  Hence, (21 x 4) = 84.

J2/
   Number of times EPA will require additional information assumes there is a 50
   percent probability that any one firm will need to provide additional
   information to meet EPA requirements.  Hence, (.50 x 7 producers) + (.50 x 14
   importers) x 4 = 42 additional information requests per year.

o/
   Number of site visits assumes one visit per year to each of the seven
   producers and 14 importers.  Each producer is assumed to have two facilities.
   Hence, (1x7 producers x 2) + (1 x 14 importers) = 28 site visits per year.

E/
   Number of reports on production/import levels assumes that the 21 producers
   and importers will submit reports quarterly.  Hence, (21 x 4) = 84.

a/
   Number of enforcement actions involving penalties assumes there is a 10
   percent probability that any one producer or importer will be required to pay
   a penalty for a violation.  On average, therefore, EPA is expected to levy
   two penalty actions per year.  Hence, (.10 x 7 producers) + (.1 x 14
   importers) = 2 penalty actions per year.

£/
   Number of enforcement actions involving litigation assumes there is a five
   percent probability that EPA will conduct litigation against any one producer
   or importer regarding a violation.  On average, therefore, EPA is expected to
   conduct .20 litigation actions per year.  Hence, (.05 x 7 producers) + (.05 x
   14 importers) = 1 litigation action.

s/
   EPA will maintain adequate technical and administrative support to implement
   this program.  Such support shall include timely responses to requests for
   information, procedural inquiries, and program implementation workshops,
   technical support to address data management concerns as the program
   develops.  FTE levels equal 50 percent of operational FTE levels.

-------
                                      •3-
t/
   Travel costs include $310 for airfare, $50 for car rental, and $85 for per
   diem for two days for a total of $530 each trip, or $14,840 for 28 trips.

-------
                                     -4-
                                AUCTIONED RIGHTS
                        INDUSTRY ADMINISTRATIVE BURDENS
                                   FOOTNOTES
a/
   Total Producer Hours represents the Number of Occurrences per year x Producer
   Hours per Occurrence x seven producers.  (C = AxBx7)

b/
   Total Producer Dollars represents Total Producer Hours x $50.00.  $50.00
   represents an average hourly rate of pay for a private firm.  (D = C x
   $50.00)
   Total Importer Hours represents the Number of Occurrences per year x Importer
   Hours per Occurrence x 14 importers.  (F = AxExl4)


   Total Importer Dollars represents Total Importer Hours x $50.00.  $50.00
   represents an average hourly rate of pay for a private firm.  (G = Fx$50.00)

   Total Other Parties represents the number of exporters, first line buyers,
   and other parties estimated to participate in each of the activities.


   Total Other Parties Hours represents the number of Occurrences per year x
   Other Parties Hours per Occurrence.

£/
   Total Other Parties Dollars represents the Total Other Parties Hours x
   $50.00.  $50.00 represents an average hourly rate of pay for a private firm.
   (K - J x $50.00).

V
   Total Industry Costs represents the sum of Total Producer Dollars, Total
   Importer Dollars and Total Other Parties Dollars.  (L - D+G+K).

i/
   A sample of two percent (140) first line buyers will be surveyed in addition
   to the producers/importers who have already provided historic data.


   The number of parties conducting market analyses and responding to the bid
   solicitation assumes 2,081 parties will submit bids.  This assumes 20 percent
   of the 7,000 first line buyers will bid, 2 percent of the approximately
   33,000 other parties will bid, and all 21 producers and importers will bid.
   Hence, (.2 x 7,000) + (.02 x 33,000) + 21 - 2,081.


   This assumes that all producers and importers (21) and 50 percent of all
   other bidders (or approximately 500) will be successful.

-------
                                     -5-
l/
   The number of parties evaluating the expected impact of the system and
   planning transfer activities assumes that approximately 2,081 parties will
   conduct this activity.

m/
   The number of transfer requests assumes that producers and importers (21) and
   an additional 500 parties will choose to conduct transactions once per year,
   and 30 exporters will transfer consumption rights weekly.  Hence, (!' x 500) +
   (52 x 30) = 2,060 transfer requests by other parties.

D/
   Number of requests to obtain additional consumption rights through exports
   assumes that producers and importers (21) and an additional 500 parties will
   choose to conduct such activities once each year, and 30 exporters will
   request additional rights weekly.  Hence, (1 x 500) + (52 x 30) - 2,060
   requests by other parties.

o/
   Number of requests to convert potential production rights into production
   rights through exports assumes that producers and importers (21) and an
   additional 500 parties will choose to conduct such activities once each year.

B/
   Firms will maintain data for EPA in the same format as collected fo.r their
   internal use.  Hence, this activity will require no additional time.

a/
   Firms will submit report data quarterly in the same format as collected for
   internal use.  EPA will not require a specific form.  This number assumes 8
   hours per quarter per firm to package and mail the information to EPA.

£/
   Number of additional information requests assumes that there is a 50 percent
   probability each quarter that firms will need to provide additional
   information to meet EPA requirements.  Hence, (.5 x 4) ~ 2.

s/
   Hours for site visits assumes one visit per year to each of the seven
   producers and the 14 importers.  Each producer is assumed to have two
   facilities.  Total producer hours, therefore, are multiplied by two to
   represent 14 visits.

£/
   Number of enforcement actions involving penalties assumes there is a ten
   percent probability that any one producer or importer will be required to pay
   a penalty for a violation.  On average, EPA is expected to levy two penalty
   actions per year.

u/
   Number of enforcement actions involving litigation assumes there is a five
   percent probability that any one producer or importer will be involved in
   litigation regarding a violation.  On average, EPA is expected to conduct one
   litigation action per year.

-------
                                                                                              EXHIBIT 6

                                                                                              CFC CONTROL  OPTIONS
                                                                                              Allocated Quotas
                                                                                              EPA Administrative Burdens
                                  ACTIVITIES
                                                                                                                 B
                                            EPA

                                             C
                                                                                               NUMBER OF        EPA       TOTAL      TOTAL
                                                                                              OCCURRENCES    HOURS PER     EPA        EPA
                                                                                               PER TEAR     OCCURRENCE    HOURS     DOLLARS
                                                                                                                       (C-A*B)[al  
-------
                                                                                              EXHIBIT 6  (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Allocated  Quotas
                                                                                              EPA Administrative Burdens
                                   ACTIVITIES
          Develop instructions for obtaining information on import and export
          activities
          Determine site visit policies (for monitoring compliance)
               Define purpose, items to be inspected,  duration of visit,  develop
               schedules, design notices to producers/importers
          Design operational guidelines for violation and penalty system,
          including definitions, forms, penalty levels, notification procedures,
          and litigation policies
4.   Develop Guidelines and Permitting Procedures for Destruction and
     Permanent Encapsulation of Controlled Substances
                                                                                3.SUBTOTAL
                                                                                4. SUBTOTAL
                                                   TOTAL EPA START-UP
OPERATIONS PHASE
1.   Set up Tracking System and Establish Accounts for All Producers/Importers
2.   Track Requests for Consumption, Production,  and Conversion Rights,  and
     for Transfers
     A.   Receive requests for transfers and additional rights
     B.   Evaluate requests and required documentation
     C.   Examine "problem" requests and notify firms
     D.   Modify records
     E.   Notify producers/importers of approval
                                                                                1. SUBTOTAL

A
NUMBER OF
OCCURRENCES
PER YEAR
1.00
1.00
1.00
1.00


1.00

1623.00
1623.00
325.00
1623.00
1623.00

B
EPA
HOURS PER
OCCURRENCE
80
64
64
224
192


[f] 20

Igl 0.5
[h] 8
0.1
1
EPA
C
TOTAL
•EPA
HOURS
(C=A*B)[aJ
80
64
224
1,056
192
192
2,392
20
20
812
8,115
2,600
162
1,623

D
TOTAL
EPA
DOLLARS

-------
                                                                                              EXHIBIT 6 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Allocated Quotas
                                                                                              EPA Administrative Burdens
                                  ACTIVITIES
3.   Conduct Compliance Monitoring Activities
     A.   Receive and review  reports on production and shipments, use of
          raw materials, total consumption rights, potential production rights,
          production rights,  conversion rights, and data on recoverable and
          recyclable material
     B.   Receive and review  reports on import and export activities
     C.   Obtain additional information from producers/importers/exporters as
          needed
     D.   Conduct site visits to ensure productlon/lmport/export activities are
          consistent with records
               Schedule site  visits
               Plan site visit activities
               Conduct site visits
     E.   Evaluate data on production/import/export levels (from  reports.
          In-house tracking systems, and site visits) to ensure that firms have
          complied with their Units.  Examine import/export records; reconcile
          differences; account for destruction
                                                                               3.SUBTOTAL
4.   Take Enforcement Action as  Needed
     A.   Levy penalties (includes notification, documentation, calculations,
          and negotiations)
     B.   Conduct litigation (includes notification, documentation, negotiation,
          and preperation for litigation)
                                                                               (.SUBTOTAL

                                                  TOTAL EPA OPERATIONS
                                                  TECHNICAL AND ADMINISTRATIVE SUPPORT  Co]
                                                  TRAVEL COSTS
                                                  TOTAL EPA OPERATIONS (including travel and support costs)

                                                  TOTAL EPA START-UP AND OPERATIONS
                                                  TOTAL EPA FTE (HOURS/2080)

A B
NUMBER OF EPA
OCCURRENCES HOURS PER
PER YEAR OCCURRENCE
84.00 [i] 8
84.00 4
42.00 [j] 20
28.00 [kl 60
12
16
32
84.00 [1] 32

2.00 [ml 160
1.00 [n] 2,080

upport costs)
EPA
C
TOTAL
EPA
HOURS
(C=A*B)[aJ
672
336
840
1,680
2,688
6,216
320
2,080
2,400
21,948
6,689
28.637
31*029"
14.92

D
TOTAL
EPA
DOLLARS
(D=C*S30.45)(bl
20,462
10,231
25,578
51.156
81,850
$189,277
9,744
63,336
$73,080
$668,311
$203,680
$14,840 (pi
$886,831
$959,667

E
CONTRACTOR
HOURS PER
OCCURRENCE
36
24
40
0
0
0
0
50

0
0

	
CONTRACTOR
F
TOTAL
CONTRACTOR
HOURS
(F=A*E)lc)
3,024
2,016
1,680
0
4,200
10.920
0
0
0
24,726
24,726
=====ssssa=:
43.986

G
TOTAL
CONTRACTOR
DOLLARS
(G-F*S50.00)
151.200
100,800
84,000
0
210,000
$546,000
0
0
$0
SI, 236,300
SI, 236, 300
$2,199*300
                                                                                                                                                                                                     TOTAL
                                                                                                                                                                                                     TOTAL
                                                                                                                                                                                                     AGENCY
                                                                                                                                                                                                      COST
                                                                                                                                                                                                   (H=D+G)[eJ
   171,662
   111,031
   109,578

    51,156
   291,850
  $735,277


     9,744

    63,336


   $73,080
SI.904.611
  $203.680
   $14.840
$2,123,131

$3,158,967

-------
                                                                                              EXHIBIT 5 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Auctioned Rights
                                                                                              EPA Administrative Burdens
                                  ACTIVITIES
                                                                                                                 B
                                           EPA

                                            C
                                                                                               NUMBER OF        EPA       TOTAL      TOTAL
                                                                                              OCCURRENCES    HOURS PER     EPA        EPA
                                                                                               PER YEAR     OCCURRENCE    HOURS     DOLLARS
                                                                                                                       
-------
                                                                                              EXHIBIT 5 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Auctioned Rights
                                                                                              EPA Adninistrative Burdens
                                   ACTIVITIES
5.
D.   Determine site visit policies (for monitoring compliance)
          Define purpose, items to be inspected, duration of visit,
          develop schedules, design notices to producers/importers
E.   Design operational guidelines for the violation and penalty system
     including definitions,  forms, penalty levels, notification procedures,
     and litigation policies


Develop Guidelines and Permitting Procedures for Destruction and Permanent
Encapsulation of Controlled Substances
                                                                               4.SUBTOTAL
                                                                               5. SUBTOTAL
                                                   TOTAL EPA START-UP
OPERATIONS PHASE
1.   Conduct Sealed Bid Auction
     A.   Announce the auction in appropriate media
B.
C.
D.
          Respond to questions
          Evaluate Bids
               Receive, verify, and record bids
               Evaluate and accept or reject bids based on procedures developed
               in start-up phase
               Identify uniform auction price based on highest rejected bid
          Notify all bidders of results and provide instructions for obtaining
          rights
               Calculate amount owed by each successful bidder
               Prepare letters
               Send letters
               Answer inquiries
               Issue rights
2.
     Set Up Tracking System
     A.   Establish accounts for all successful bidders
     B.   Establish accounts for new entrants
                                                                                1.SUBTOTAL
                                                                                2.SUBTOTAL

A
NUMBER OF
OCCURRENCES
PER TEAR






1.00
1.00
1.00
1.00
1.00
1.00
1.00

1.00
1.00

B
EPA
HOURS PER
OCCURRENCE
64
64
224
192
130
320
[g] 2.200
550
1,600
50
[hi 4,246
1,414
435
435
1,086
876
[i] 64
[Jl 64
EPA
C
TOTAL
EPA
HOURS
CC=A*B>[a]
64
224
952
192
192
3,976
130
320
2,200
4,246

6,896
64
64

D
TOTAL
EPA
DOLLARS
(D*C*$30.45)lbl
1,949
6,821
S28.988
5,846
15,846
(121,069
3,959
9,744
66,990
129,291

S209.983
1.949
1,949

E
CONTRACTOR
HOURS PER
OCCURRENCE
600
600
2,100
1,800

20
0
4,100
875
2,625
600
18,750
9,750
3.000
0
0
6.000
650
650
CONTRACTOR
F
TOTAL
CONTRACTOR
HOURS
(F=A*EMcl
600
2,100
8,925
1,800
1.800
36,105
20
0
4,100
18,750

22,870
650
650

G
TOTAL
CONTRACTOR
DOLLARS

-------
                                                                                              EXHIBIT 6 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Allocated Quotas
                                                                                              Industry Administrative Burden
                                   ACTIVITIES
START-UP PHASE
1.   Evaluate Expected Impact of Production/Consumption Rights on Operations
     A.   Analyze impact of limits
     B.   Plan operational response to limits
     C.   Plan transfer and export activities
                                                   TOTAL INDUSTRY START-UP
OPERATIONS PHASE
1.   Implement Operational Changes to Comply with Regulations


2.   Conduct Transfer Transactions
     A.   Prepare and submit transfer request to EPA
     B.   Obtain EPA approval for transfer
     C.   Modify records regarding inventory of production and consumption
          rights


3.   obtain Additional Consumption Rights through Exports
     A.   Prepare and submit request and proof of exports of controlled
          substances
     8.   Obtain additional consumption rights from EPA
                                                                                1.SUBTOTAL
1.SUBTOTAL
2.SUBTOTAL
                                                                                3.SUBTOTAL

A
NUMBER OF
OCCURRENCES
PER TEAR
1.00
1.00
1.00


1.00

75.29
75.29
75.29

75.29
75.29


B
PRODUCER
HOURS PER
OCCURRENCE
160
400
160


400

[f] "5
1

[gl 5
2

PRODUCER
C
TOTAL
PRODUCER
HOURS
(C=A"B*7)lal
1.120
2.800
1,120
5,040
5,040
2,800
2,800
2,635
1,054
527
4,216
2,635
1,054
3,689

D
TOTAL
PRODUCER
DOLLARS
(D=C*»50)[bJ
56,000
140,000
56,000
$252,000
$252,000
140.000
S140.000
131.758
52,703
26,352
1210,812
131,758
52.703
$184,461

E
IMPORTER
HOURS PER
OCCURRENCE
80
200
80


200

5
2
1

5
2

IMPORTER
F
TOTAL
IMPORTER
HOURS

-------
                                                                                              EXHIBIT 6 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Allocated Quotas
                                                                                              Industry Administrative Burden
                                  ACTIVITIES
6.
     Convert Potential  Production  Rights  into Production Rights  through Exports
     to Parties (Additional  Production Rights are Granted Through Transactions
     with 25 Kilotoime  Parties)
     A.   Obtain production reduction documentation from embassy
     B.   Prepare and submit request  and  proof of exports of controlled
          substances
     C.   Obtain notice of production rights from EPA


     Comply with EPA Reporting and Compliance Monitoring Requirements
     A.   Maintain records of production, raw materials used,  sales, shipments,
          controlled substances  recovered and recycled, and import  and export
          activities
     B.   Prepare and submit reports  on production, feedstock  consumption,
          shipments, total consumption rights, potential production rights,
          production rights, conversion rights, and data on recoverable and
          recyclable materials
     C.   Prepare and submit reports  on import and export activities
     D.   Provide additional information  requested by EPA
     E.   Prepare for EPA site visits
     F.   Accommodate EPA site visits
4.SUBTOTAL
     Respond to any Enforcement Activity
                nail
                                                                               5. SUBTOTAL
     A.
          Pay penalties (includes negotiation)
          Conduct litigation (includes negotiation,  preparation for  litigation)

                                                                               6. SUBTOTAL

                                                TOTAL INDUSTRY OPERATIONS

                                                TOTAL INDUSTRY START-UP  AND  OPERATIONS

A
NUMBER OF
OCCURRENCES
PER YEAR






1.00
1.00
1.00
4.00
4.00
4.00
2.00
1.00
1.00
0.10
0.05

B
PRODUCER
HOURS PER
OCCURRENCE
Ih) 40
40
2
0
8
40
[k] 24
32
16
(ml 160
In] 2,080
PRODUCER
C
TOTAL
PRODUCER
(C=A*B*7) [a]
280
280
14
574
(i) 0
(jl 224
1,120
336
448
224
2,352
112
728
840
14,471
19,511

D
TOTAL
PRODUCER
DOLLARS
(D=C*S50) [b]
14,000
14,000
700
S28.700
0
11,200
56,000
16,800
[I] 22,400
[I] 11,200
SI 17,600
5,600
36,400
$42,000
$723,573
$975,573

E
IMPORTER
HOURS PER
OCCURRENCE
40
40
2
0
8
40
8
8
16
40
1,040


IMPORTER
F
TOTAL
IMPORTER
HOURS

-------
                                   EXHIBIT 6

                                ALLOCATED QUOTAS
                           EPA ADMINISTRATIVE BURDENS
                                   FOOTNOTES

a/
    Total EPA Hours represents the Number of Occurrences per year x EPA Hours
    per Occurrence.  (C - AxB)

b/
    Total EPA Dollars represents Total EPA hours x $30.45.  $30.45 represents
    the hourly rate of pay of a government employee at Grade 10, step 7, which
    is $14.50 per hour, and an overhead rate of 110 percent.  Source:  EPA
    Appendix D.28.1:  Preparing Information Collection Requests.  (D = Cx$30.45)

c/
    Total Contractor Hours represents the Number of Occurrences per year x
    Contractor Hours per Occurrence.  (F = AxE)

d/
    Total Contractor Dollars represents Total EPA Hours x $50.00.  $50.00
    represents an average hourly rate of pay for a contractor.  (G = Fx$50.00)

e/
    Total Agency Costs represents the sum of Total EPA Dollars and Total
    Contractor Dollars.  (H = D+G)

£/
    Establishing accounts for 21 producers/importers assumes it will take one
    hour of EPA time plus contractor support to set up each account.

£/
    Number of requests for transfers and additional rights is based on the
    assumption that producers and importers choose to conduct transactions three
    times per year, and that 30 exporters will request, receive, and
    subsequently trade, consumption rights weekly to producers/importers.
    Hence, (7 producers x 3) + (14 importers x 3) + (30 exporters x 52) = 1,623
    transactions per year.

h/
    Number of problem transactions assumes 20 percent of the requests will be
    flagged as problems.  Hence, (1,623 transactions x .2) = 325 problems per
    year.

i/
    Number of reports received per year is based on the assumption that
    producers/importers will be required to submit reports quarterly.

i/
    Number of times EPA will require additional information assumes there is a
    50 percent probability that any one firm will need to provide additional
    information to meet EPA requirements.  Hence, (.50 x 7 producers) + (.50 x
    14 importers) x 4 = 42 additional information requests per year.

-------
                                     -2-
k/
   •Number of site visits assumes one visit per year to each of the seven
    producers, and one visit per year to the 14 importers.  Each producer is
    assumed to have two facilities.  Hence, (1x7 producers x 2) + (1 x 14
    importers) = 28 site visits per year.

It
    Number of times EPA will evaluate data on production/import levels assumes
    evaluations will occur quarterly for 21 producers/importers.  Hence', (21
    producers/importers) x 4 = 84.

E/
    Number of enforcement actions involving penalties assumes there is a ten
    percent probability that any one producer or importer will be required to
    pay a penalty for a violation.  On average, therefore, EPA is expected to
    levy two penalty actions per year.  Hence, (.10 x 7 producers) + (.10 x 14
    importers) = 2 penalty actions per year.

D/
    Number of enforcement actions involving litigation assumes there is a five
    percent probability that EPA will conduct litigation against any one
    producer or importer regarding a violation.  On average, therefore, EPA is
    expected to conduct 1 litigation action per year.  Hence, (.05 x 7
    producers) + (.05 x 14 importers) = 1 litigation action.

o/
    EPA will maintain adequate technical and administrative support to implement
    this program.  Such support shall include timely responses to requests for
    information, procedural inquiries and program implementation workshops, and
    technical support to address data management concerns.  FTE level equal 50
    percent of operational FTE levels.

B/
    Travel costs include $310 for airfare, $50 for car rental, and $85 for per
    diem for two days for a total of $530 each trip, or $14,840 for 28 trips.

-------
                                     -3-
                                ALLOCATED QUOTAS
                        INDUSTRY ADMINISTRATIVE BURDENS
                                   FOOTNOTES

a/
    Total Producer Hours represents the Number of Occurrences per year x
    Producer Hours per Occurrence x seven producers.  (C - AxBx?)

b/
    Total Producer Dollars represents Total Producer Hours x $50.00.  $50.00
    represents an average hourly rate of pay for a private firm.  (D - C x
    $50.00)

£/
    Total Importer Hours represents the Number of Occurrences per year x
    Importer Hours per Occurrence x 14 importers.  (F = AxExl4)

d/
    Total Importer Dollars represents Total Importer Hours x $50.00.  $50.00
    represents an average hourly rate of pay for a private firm.  (G = Fx$50.00)

e/
    Total Industry Costs represents the sum of Total Producer Dollars and Total
    Importer Dollars.  (H = D+G)

£/
    Number of transfer transactions is based on the assumption that
    producers/importers choose to conduct transactions one time per year, and
    that 30 exporters will transfer consumption rights weekly.  Hence, (7
    producers x 1) + (14 importers x 1) + (30 exporters x 52) * 21
    producers/importers =• 75.29 transactions per year.

«/
    Number of requests to obtain additional consumption rights through exports
    assumes that firms will conduct such activities one time per year, and that
    30 exporters will request, receive, and subsequently trade, consumption
    rights weekly to producers/importers.  Hence, (7 producers x 1) + (14
    importers x 1) + (30 exporters x 52) * 21 producers/importers = 75.29
    requests per year.

h/
    Number of requests to convert potential production rights into production
    rights through exports assumes that producers/importers will choose to
    conduct such activities one time per year.

i/
    Firms will maintain data for EPA in the same format as collected for their
    internal use.  Hence,  this activity will require no additional time.

I/
    Firms will submit report data quarterly in the same format as collected for
    internal use.  EPA will not require a specific form.   This number assumes 4
    hours per quarter per firm to package and mail the information to EPA.

-------
                                     -4-
   .
    Number of additional information requests assumes there is a 50 percent
    probability each quarter that firms will need to provide additional
    information to meet EPA requirements.  Hence, (.50 x 4) = 2.

I/
    Hours for site visits assumes one visit per year to each of the seven
    producers and 14 importers.  Each producer is assumed to have two
    facilities.  Total producer hours, therefore, are multiplied by two to
    represent 14 visits.

m/
    Number of enforcement actions involving penalties assumes there is a ten
    percent probability that any one producer or importer will be required to
    pay a penalty for a violation.

D/
    Number of enforcement actions involving litigation assumes there is a five
    percent probability that any one producer or importer will be involved in
    litigation regarding a violation.

-------
                                                                                              EXHIBIT 7

                                                                                              CFC CONTROL OPTIONS
                                                                                              Regulatory Fees
                                                                                              EPA Administrative Burdens
                                  ACTIVITIES
START-UP PHASE
1.   Set Initial  Fee Level  and Refine Formula  for Adjusting Fee Level to
     Yield Regulatory Goals
     A.    Review  available  data regarding the  economies of the controlled
          substance Industry and historical  impacts of changing controlled
          substance prices
     B.    Review  existing controlled substance model and revise as necessary to
          use in  estimating appropriate fee  levels
     C.    Run model to estimate fee levels necessary to yield regulatory
          production/import targets
     D.    Finalize initial  fee and self-adjusting formula contained in final
          rule
     E.    Determine schedule and procedures  for  periodic reassessment of the
          self-adjusting formula
     F.    Notify  producers/importers of initial  fee level
               Prepare Information
               Send information
               Answer inquiries
                                                                                1.SUBTOTAL
     Design Recordkeeping and Compliance Monitoring System
     A.   Develop detailed design of system
               Define information that producers/importers must provide on
               production/consinptlon levels and fees submitted,  and establish
               format for entering data                         ~
               Establish system to verify that  fee reports submitted to EPA are
               consistent with U.S. Treasury records
               Define requirements for determining whether fees paid are
               consistent with product ion/consumption levels
     B.   Design and test forms and instructions for obtaining production/import
          and fee payment information
     C.   Determine site visit policies (for monitoring compliance)
               Define purpose, items to be inspected, duration of visit, develop
               schedules, design notices to producers/importers
     D.   Design operational guidelines for the violation and penalty  system
                                                                                2.SUBTOTAL
EPA
A B . C D
NUMBER OF EPA TOTAL TOTAL
OCCURRENCES HOURS PER EPA EPA
PER YEAR OCCURRENCE HOURS DOLLARS

-------
                                                                                               EXHIBIT  7 (CONTINUED)

                                                                                               CFC CONTROL  OPTIONS
                                                                                               Regulatory Fees
                                                                                               EPA Administrative Burdens
                                   ACTIVITIES
3.
     Develop Guidelines and Permitting Procedures for Destruction and Permanent
     Encapsulation of Controlled Substances
                                                                                3.SUBTOTAL
                                   TOTAL EPA START-UP
OPERATIONS PHASE
1.   Conduct Compliance Monitoring Activities
     A.   Receive and review reports on production/consumption levels and fee
          payments
     B.   Verify fee payment reports with U.S.  Treasury records
     C.   Obtain additional  information from producers/importers/exporters as
          needed
     0.   Evaluate data on production/import levels and fees paid to ensure that
          fees submitted reflect actual production/consumption levels (includes
          checking calculations of fee payments)
     E.   Notify firms of delinquent or incorrect fee payments
     F.   Conduct site visits to ensure production/import  levels and fee
          payments are consistent with records
               Schedule site visits
               Plan site visit activities
               Conduct site  visits
2.   Revise Self-Adjusting formula as Necessary
     A.   Determine if fee levels (as determined by self-adjusting formula)
          are yielding regulatory production goals, and if formula needs
          to be revised
     B.   Prepare formula revisions as necessary, based on results of  analysis.
          or based on changes in regulations
                                                                                1. SUBTOTAL
                                                                                2.SUBTOTAL

A
NUMBER OF
OCCURRENCES
PER YEAR
1.00


64.00
84.00
42.00
84.00
17.00
28.00


1.00
1.00


B
EPA
HOURS PER
OCCURRENCE
192


[fl 4
[g] 4
Ih] 20
[i] 24
[J] 24
Ik] 60
12
16
32

6
160

EPA
C
TOTAL
EPA
HOURS
(C=A*B)fa)
192
192
3,600
336
336
840
2,016
408
1.680

5,616
6
160
166

D
TOTAL
EPA
DOLLARS
(D°C*(30.45)[b)
5.846
S5.846
1 109, 620
10,231
10,231
25,578
61,387
12.424
51.156

$171,007
183
4.872
(5,055

E
CONTRACTOR
HOURS PER
OCCURRENCE
1.800


20
20
60
32
120
0
0
0
0

20
4.800

CONTRACTOR
F
TOTAL
CONTRACTOR
HOURS

-------
                                                                                              EXHIBIT 7 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Regulatory Fees
                                                                                              EPA Administrative Burdens
                                  ACTIVITIES
3.   Take Enforcement Action as Needed
     A.   Levy penalties (includes notification, documentation,  calculations,
          and negotiations)
     B.   Conduct litigation (includes notification,  documentation,  negotiation,
          and preparation for litigation)
                                                                                3. SUBTOTAL
                          TOTAL EPA OPERATIONS
                          TECHNICAL AND ADMINISTRATIVE  SUPPORT  [n]
                          TRAVEL COSTS
                          TOTAL EPA OPERATIONS (including travel  and travel  costs)

                          TOTAL EPA START-UP AND OPERATIONS
                          TOTAL EPA FTE (HOURS/2080)
                                                                                                                 B
                       EPA

                        C
                                                                                               NUMBER OF         EPA       TOTAL       TOTAL
                                                                                              OCCURRENCES     HOURS PER     EPA        EPA
                                                                                               PER  YEAR     OCCURRENCE    HOURS     DOLLARS
                                                                                                                       (C-A*B)(a]  (D=C*$30.4S)[bl
2.00 [I)

1.00 [m]
  160

2,080
  320

2,080
 9,744

63,336
                        2,400     $73,080

                        8,182    S249.142
                        7,649    $232,912
                                  $14,840 [o]
                       15,831    $496.894
                       19,431
                         9.34
                    $606,514

E
CONTRACTOR
HOURS PER
OCCURRENCE
0
0



CONTRACTOR
F
TOTAL
CONTRACTOR
HOURS
(F=A*E)[cl
0
0
0
15,428
15,428
34,808

G
TOTAL
CONTRACTOR
DOLLARS
(G=F**50.00)[dJ
0
0
$0
$771,400
$771,400
$1,740,400
TOTAL
H
TOTAL
AGENCY
COST

-------
                                                                                              EXHIBIT 7 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Regulatory Fees
                                                                                              Industry Administrative Burdens
                              ACTIVITIES
START-UP PHASE
1.   Obtain Final Fee Level  and Formula from EPA and Evaluate Expected  Impact
     of Fee
     A.   Analyze impact of  fee levels
     B.   Plan operational  response to fee levels
                                                                               1.SUBTOTAL
2.   Design Internal Fee Payment System
     A.   Set up system for determining fee amount owed
     B.   Set up accounting system to pay correct fee amounts to U.S.  Treasury
3.   Design System to Meet EPA Reporting and Compliance Monitoring Requirements
     A.   Design in-house system to track production/consumption levels and
          fees paid
     B.   Design reporting system to meet EPA requirements
                                                                               2.SUBTOTAL
                                                                               J.SUBTOTAL
                                    TOTAL INDUSTRY START-UP
OPERATIONS PHASE
1.


2.
Implement Operational  Changes Based on Analysis of  Impact  of  Fee System


Pay Fees Based on Product ion/Import Levels
A.   Determine fee amounts owed
B.   Disburse fee amounts to the U.S.  Treasury with appropriate paperwork
C.   Notify EPA of payment
1.SUBTOTAL

A
NUMBER OF
OCCURRENCES
PER YEAR






1.00
1.00
1.00
1.00
1.00
1.00
1.00
4.00
4.00
4.00

B '
PRODUCER
HOURS PER
OCCURRENCES
120
80
120
80
160
40
160
If] 16
2
2
PRODUCER
C
TOTAL
PRODUCER
HOURS

-------
                                                                                               EXHIBIT 7 (CONTINUED)

                                                                                               CFC CONTROL OPTIONS
                                                                                               Regulatory Fees
                                                                                               Industry Administrative Burdens
                              ACTIVITIES
3.   Comply with EPA Reporting and Compliance Monitoring Requirements
     A.   Maintain records on production/consumption activities and fee
          payments
     B.   Prepare and submit reports
     C.   Provide additional information requested by EPA
     0.   Prepare for EPA site visits
     E.   Accomodate EPA site visits
     F.   Disburse additional or corrected fee amounts to U.S.  Treasury
4.   Respond to Any Enforcement Activity
     A.   Pay penalties (includes negotiation)
     8.   Conduct litigation (includes negatiation,  preparation for litigation)
                                                                               3. SUBTOTAL
                                                                               4. SUBTOTAL
                                    TOTAL INDUSTRY OPERATIONS

                                    TOTAL INDUSTRY START-UP AND OPERATIONS

A
NUMBER OF
OCCURRENCES
PER YEAR

4.00
4.00
2.00
1.00
1.00
0.40

0.10
O.OS





B
PRODUCER
HOURS PER
OCCURRENCES

0 [gl
[h] 40
(II 24
32
16
lit 24

[I] 160
[ml 2,080




PRODUCER
C
TOTAL
PRODUCER
HOURS
(C=A*B*7)[8j
0
1,120
336
448 [k]
224 [k]
67
2,195
112
728
840
4,715
ss==n=rs=sssa=
8,915

D
TOTAL
PRODUCER
DOLLARS
(D*C*$50)(bl
0
56,000
16,800
22,400
11,200
3,360
$109,760
5,600
36,400
$42,000
$235,760
=================
$445,760

E
IMPORTER
HOURS PER
OCCURRENCE

0
40
8
8
16
8

40
1,040


:=====3=sc====

IMPORTER
F
TOTAL
IMPORTER
HOURS
(F=A*E*14)[C)
[h! 0
2,240
224
112
224
45
2,845
56
728
784
5,029
:======s===s===ss
8,529

G
TOTAL
IMPORTER
DOLLARS
(G-F*$50)[dl
0
112,000
11,200
5,600
11,200
2,240
$142,240
2,800
36,400
$39,200
$251,440
— — — — — — — saSSBS
$426,440
                                                                                                                                                                                                          TOTAL
                                                                                                                                                                                                          TOTAL
                                                                                                                                                                                                         INDUSTRY
                                                                                                                                                                                                           COST
                                                                                                                                                                                                        
-------
                                   EXHIBIT 7

                                REGDIATORY FEES
                           EPA ADMINISTRATIVE BURDENS
                                   FOOTNOTES

a/
    Total EPA Hours represents the Number of Occurrences per year x EPA Hours
    per Occurrence.  (C = AxB)

V
    Total EPA Dollars represents Total EPA hours x $30.45.  $30.45 represents
    the hourly rate of pay of a government employee at Grade 10, step 7, which
    is $14.50 per hour, and an overhead rate of 110 percent.  Source:  EPA
    Appendix D.28.1:  Preparing Information Collection Requests.  (D = Cx$30.45)

c/
    Total Contractor Hours represents the Number of Occurrences per year x
    Contractor Hours per Occurrence.  (F = AxE)
    Total Contractor Dollars represents Total EPA Hours x $50.00.  $50.00
    represents an average hourly rate of pay for a contractor.  (G = Fx$50.00)

e/
    Total Agency Costs represents the sum of Total EPA Dollars and Total
    Contractor Dollars.  (H = D+G)

£/
    Number of reports received per year is based on the assumption that
    producers/importers will be required to submit reports quarterly on fee
    payments, production, feedstock consumption, shipments, total consumption
    rights, potential production rights, production rights, conversion rights,
    and data on recoverable and recyclable materials.  Hence, (21
    producers/importers x 4) = 84.

&/
    Verification of fee payment reports will be conducted quarterly when reports
    are submitted on fee payments, production, feedstock consumption, shipments,
    total consumption rights, potential production rights, production rights,
    conversion rights, and data on recoverable and recyclable materials.  Hence,
    (21 producers/ importers x 4) =84.

h/
    Number of times EPA will require additional information assumes there is a
    50 percent probability each month that any one firm will need to provide
    additional information to meet EPA reporting requirements.  Hence, [(.50 x 7
    producers) + (.50 x 14 importers) x 4] =42 additional information requests
    per year.

i/
    Number of times EPA will evaluate data on production/import levels assumes
    evaluations will occur quarterly.  Hence, (21 producers/importers x 4) =84.

-------
                                     -2-
i/
    Number of notices assumes that there is a 20 percent probability each
    quarter that any one producer or importer will make a delinquent or
    incorrect fee payment.  Hence, [(.2 x 7 producers) + (.2 x 14 importers) x
    4] = 17 notices will be issued per year.

k/
    Number of site visits assumes one visit per year to each of the seven
    producers, and one visit to the 14 importers.  Estimate assumes site visits
    are made to two facilities per producer.  Hence, (2x7 producers) + (1 x 14
    importers) - 28 site visits per year.

I/
    Number of enforcement actions involving penalties assumes there is a ten
    percent probability that any one producer or importer will be required to
    pay a penalty for a fee violation.  On average, therefore, EPA is expected
    to levy two penalty actions per year.  Hence, (.10 x 7 producers) + (.10 x
    14 importers) - 2 penalty actions per year.
as/
    Number of enforcement actions involving litigation assumes there is a five
    percent probability that EPA will conduct litigation against any one
    producer or importer regarding a fee violation.  On average, therefore, EPA
    is expected to conduct 1 litigation action per year.  Hence, (.05 x 7
    producers) + (.05 x 14 importers) = 1 litigation action.

n/
    EPA will maintain adequate technical and administrative support to implement
    this program.  Such support shall include timely responses to requests for
    information, procedural inquiries and program implementation workshops, and
    technical support to address data management concerns.  FTE level equals 50
    percent of operational FTE levels.

o/
    Travel costs include $310 for airfare, $50 for car rental, and $85 for per
    diem for two days for a total of $530 each trip, or $14,840 for 28 trips.

-------
                                      -3-
                                REGULATORY FEES
                        INDUSTRY ADMINISTRATIVE BURDENS
                                   JHXJXNuTES

a/
    Total Producer. Hours represents the Number of Occurrences per year x
    Producer Hours per Occurrence x seven producers.  (C = AxBx7)

b/
    Total Producer Dollars represents Total Producer Hours x $50.00.  $50.00
    represents an average hourly rate of pay for a private firm.  (D = C x
    $50.00)

£/
    Total Importer Hours represents the Number of Occurrences per year x
    Importer Hours per Occurrence x 14 importers.  (F = AxExl4)
    Total Importer Dollars represents Total Importer Hours x $50.00.  $50.00
    represents an average hourly rate of pay for a private firm.  (G = Fx$50.00)


    Total Industry Costs represents the sum of Total Producer Dollars and Total
    Importer Dollars.  (H = D+G)
    Number of fee payments is based on the assumption that quarterly payments
    will be made to EPA.
    Firms will maintain data for EPA in the same format as collected for their
    internal use.  Hence, this activity will require no additional time.

by
    Number of reports compiled and submitted per year is based on the assumption
    that producers/importers will be required to submit reports quarterly in a
    format specified by EPA on fee payments, production, feedstock consumption,
    shipments, total consumption rights, potential production rights, production
    rights, conversion rights, and data on recoverable and recyclable materials.

i/
    Number of additional information requests assumes there is a 50 percent
    probability each month that firms will need to provide additional
    information to meet EPA requirements.  Hence, (.50 x 4) ~ 2 additional
    requests per firm.

j/
    Number of additional or corrected fee amounts submitted assumes that 10
    percent of producers and importers will be required to submit additional
    payments quarterly.  Hence, (.10 x 4) ~ .4 additional payments per firm.

-------
                                     -4-
   .Hours for site visits assumes one visit per year to each of the seven
    producers and 14 importers.  Each producer is assumed to have two
    facilities.  Total producer hours, therefore, are multiplied by two to
    represent 14 visits.

I/
    Number of enforcement actions involving penalties assumes there is a ten
    percent .probability that any one producer or importer will be required to
    pay a penalty for a fee violation.
    Number of enforcement actions involving litigation assumes there is a five
    percent probability that any one producer or importer will be involved in
    litigation regarding a fee violation.

-------
                                                                                    EXHIBIT 8

                                                                                    CFC CONTROL OPTIONS
                                                                                    Direct Regulation
                                                                                    EPA Adninistrative Burdens
                            ACTIVITIES
START-UP PHASE
t.   Design Reporting and Compliance Monitoring System for Targeted
     Industry Applications
     A.   Design compliance plan format
     B.   Develop criteria for evaluating adequacy of compliance
          plans
     C.   Design carpiiance report format
     D.   Develop criteria for determining the adequacy of
          compliance reports
          Develop policy and protocol for site visits
2.
4.
     E.
     Design System for Monitor 109 Total Use of Regulated Controlled
     Substances
     A.   Design Section 114 letter and Federal Register notice for
          obtaining total controlled substance use data from
          producers/importers
     B.   Develop means of determining if additional regulations
          are needed
     C.   Develop criteria for selecting additional control
          regulations
                                                                   1.SUBTOTAL
3.   Develop Enforcement and Litigation Policies
     Design Guidelines and Permitting Procedures for Destruction
     and Permanent Encapsulation of Controlled Substances
                                     TOTAL EPA START-UP
                                                                   2.SUBTOTAL
                                                                   3.SUBTOTAL
                                                                   4.SUBTOTAL

A
NUMBER OF
OCCURRENCES
PER YEAR







1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00


B
EPA
HOURS PER
OCCURRENCE
32
16
16
16
32
16
32
32
80
48

EPA
C
TOTAL
EPA
HOURS

-------
                                                                                    EXHIBIT 8  (CONTINUED)

                                                                                    CFC CONTROL OPTIONS
                                                                                    Direct Regulation
                                                                                    EPA Adninistratwe Burdens
                            ACTIVITIES
OPERATIONS PHASE
1.
2.
4.
5.
6.
Receive and Log Compliance Plans


Evaluate the Adequacy of Compliance Plans


Notify Firms of Results of Compliance Plan Review
     Conduct Compliance Monitoring Activities
     A.   Receive and log quarterly coupllance reports
     B.   Evaluate adequacy of  quarterly compliance  reports
     C.   Notify firms of results  of compliance report  review
     D.   Conduct site visits
     Take Enforcement Action as Needed
     A.  Levy penalties
     B.  Conduct litigation
     Evaluate Need for Further Reductions
     A.  Prepare and send Section 114 letters
     B.  Receive Section 114 letters and evaluate results
                                                                   1.SUBTOTAL
                                                                   2.SUBTOTAL
                                                                   3.SUBTOTAL
                                                                   4.SUBTOTAL
                                                                   5.SUBTOTAL
                                                                   6.SUBTOTAL
                                     TOTAL  EPA OPERATIONS
                                     TECHNICAL AND ADMINISTRATIVE  SUPPORT  [p]
                                     TRAVEL COSTS
                                     TOTAL  EPA OPERATIONS  (including travel  and support costs)

                                     TOTAL  EPA START-UP  AND OPERATIONS
                                     TOTAL  EPA FTE (HOURS/2080)


EPA
CONTRACTOR
A BCD
NUMBER OF EPA TOTAL TOTAL
OCCURRENCES HOURS PER EPA EPA
PER YEAR OCCURRENCE HOURS DOLLARS
(C=A*B)ta] (D=C*(30.45)[bl
1.00
1.00
1.00
4.00 [i]
4.00
4.00
203.00 [id
20.00 [n]
10.00 [o]
1.00
1.00
>rt costs)
1,368 (f)
5,063 [g] '
320 [hi
1,350 [j]
1,688 [k]
200
24
160
2.080
200
80
SSSS1
1.368
1.368
5.063
5,063
320
320
5,400
6,752
800
4,872
17,824
3,200
20,800
24,000
200
80
280
48.855
19,044
67,899
66.219
32.80
41.656
(41,656
154,168
(154,168
9,744
(9,744
164,430
205.598
24,360
148,352
(542,741
97,440
633,360
(730,800
6,090
2,436
(8,526
(1,487,635
(579,890
(107,590 Cq]
(2,175,115
(2,184,859
E F G
CONTRACTOR TOTAL TOTAL
HOURS PER CONTRACTOR CONTRACTOR
OCCURRENCE HOURS DOLLARS
(F=A*E)[c] (G=F*(50.00)[dl
0
60,762 [g]
30,381 [h]
0
60,762 Ik]
20,254 [I]
0
0
0
1,200
600



0
0
60,762
60,762
30,381
30,381
0
243,048
81,016
0
324,064
0
0
0
1.200
600
1,800
417,007
417,007
429,207
0
(0
3.038.100
(3,038,100
1,519,050
(1,519,050
0
12,152,400
4,050,800
0
(16,203,200
0
0
(0
60.000
30.000
(90.000
(20,850,350
(20,850.350
(21.460.350
TOTAL
TOTAL
AGENCY
COST
(H=0+GHe]
41.656
(41.656
3.192,268
(3.192,268
1.528,794
(1.528.794
164,430
12.357,998
4,075,160
148,352
(16,745.941
97.440
633,360
(730,800
66,090
32,436
(98,526
(22.337.985
(579,890
(107,590
(23.025,465
(23.645,209

-------
                                                                               EXHIBIT 8 (CONTINUED)

                                                                               CFC CONTROL OPTIONS
                                                                               Direct Regulation
                                                                               Industry Administrative Burdens
                             ACTIVITIES
START-UP PHASE
1.   Evaluate Expected Impact of Regulations
     A.   Analyze impact of regulations
     B.   Plan operational response to regulations
2.
3.
     Prepare and Submit Compliance Plan
     A.   Prepare and submit compliance plan
     B.   Respond to EPA requests for further information
                                                                   1.SUBTOTAL
     Design System to Meet EPA Reporting and Compliance Monitoring
     Requirements
                                                                   2. SUBTOTAL
                                                                   3. SUBTOTAL
OPERATIONS PHASE
                                 TOTAL INDUSTRY START-UP
     Comply with EPA Reporting and Compliance Monitoring Requirements
     A.   Research and Compile Information
     B.   Prepare and submit reports
     C.   Respond to requests for additional  information
     D.   Prepare for and accomndate EPA site visits
2.
     Respond to Any Enforcement Activity
          Pay penalties (Includes negotiation)
                                                                    1.SUBTOTAL
          conduct litigation (Includes negotiation,  preparation  for
          litigation)



A
NUMBER OF
OCCURRENCES
PER

















YEAR

1.00
1.00

1.00
0.50 th)

1.00


4.00 [i]
4.00
0.04 [j]
0.05

0.10 [I]
0.05 [ml

B
PRODUCER
HOURS PER
OCCURRENCE

0
0

0
0

0


0
0
0
0

0
0
PRODUCER
C
TOTAL
PRODUCER
HOURS
 [b]
(el 4.000
8.000
12,000
5.600
800
6.400
4,000
4.000
22,400
8,000
4,000
16
[kl 1
12,017
8
52

K
TOTAL
INDUSTRY
DOLLARS

-------
                                                                               EXHIBIT 8 (CONTINUED)

                                                                               CFC CONTROL OPTIONS
                                                                               Direct Regulation
                                                                               Industry Administrative Burdens
                            ACTIVITIES

A
NUMBER OF
OCCURRENCES
PER YEAR

B
PRODUCER
HOURS PER
OCCURRENCE
PRODUCER
c
TOTAL
PRODUCER
HOURS


D
TOTAL
PRODUCER
DOLLARS
(0=C**50)

E
IMPORTER
HOURS PER
OCCURRENCE
IMPORTER
f
TOTAL
IMPORTER
HOURS
(F=A«EM4)

G
TOTAL
IMPORTER
DOLLARS
(G=F**50)
1
H 1
FIRM TOTAL
HOURS PER FIRMS [a]
OCCURRENCE
>ACKAGING
J
TOTAL
INDUSTRY
HOURS
 [bl

K
TOTAL
INDUSTRY
DOLLARS
(KcJ*S50Hc)
3.
Respond to EPA Monitoring of  Total  Controlled Substance Use
(producers/importers)
A.   Research and compile Information
B.   Prepare response to Section 114 letter
C.   Send information to EPA
                                                                                      1.00
                                                                                      1.00
                                                                                      1.00
                                                                    3. SUBTOTAL
                                 TOTAL  INDUSTRY OPERATIONS

                                 TOTAL  INDUSTRY START-UP AND OPERATIONS
120
40
2

sss
840
280
14
1.134
1.134
1.134
42,000
14,000
700
56,700
56,700
56,700
20
20
2

BSSSSSK2B
280
280
28
588
588
SXSXSSXBSK&X&X&S
588
14,000
14,000
1,400
29,400
29.400
--3===-===:
29.400
                                                                                                                                                                                   -======----rs:5s==:
                                                                                                                                                                                                             0          SO
                                                                                                                                                                                                       ==-=----=--=========
                                                                                                                                                                                                         12,077     603.660
                                                                                                                                                                                                       ____________=s=====_

                                                                                                                                                                                                         34,477  SI,723,860

-------
                                                                               EXHIBIT 8 (CONTINUED)

                                                                               CFC CONTROL OPTIONS
                                                                               DIRECT REGULATION
                                                                               INDUSTRY ADMINISTRATIVE BURDEN
                            ACTIVITIES
START-UP PHASE
1.   Evaluate Expected Impact  of  Regulations
     A.   Analyze impact  of  regulations
     B.   Plan operational  response to regulations
                                                                   1. SUBTOTAL
2.
3.
     Prepare and Submit Compliance Plan
     A.   Prepare and submit  compliance plan
     B.   Respond to EPA requests for further  information


     Design System to Meet EPA Reporting  and Compliance Monitoring
     Requirements
                                                                   2.SUBTOTAL
                                                                   3. SUBTOTAL
                                 TOTAL  INDUSTRY START-UP
OPERATIONS PHASE
1.   Comply with EPA Reporting and Compliance Monitoring Requirements
     A.   Research and Compile Information
     B.   Prepare and submit reports
     C.   Respond to requests for additional  information
     D.   Prepare for and accommodate EPA site visits
2.   Respond to Any Enforcement Activity
     A.   Pay penalties (includes negotiation)
     B.   Conduct litigation (includes negotiation,  preparation  for
          litigation)
                                                                    1. SUBTOTAL
STERILIZATION
L
TOTAL
FIRMS [a]
154
154
154
154
154
154
154
154
2
2
2
H
TOTAL
INDUSTRY
HOURS
(M=A«H*L) [b]
If] 6,160
12,320
18,480
8,624
1.232
9,856
6,160
6,160
34,496
12,320
6,160
25
[k] 2
18,507
16
104
N
TOTAL
INDUSTRY
DOLLARS
(N=H*t50)le]
308.000
616.000
924.000
431.200
61,600
492,800
308.000
308.000
SI, 724,800
616.000
308,000
1.232
120
925.352
800
5.200
AUTOMOBILE AIR CONDITIONING
0
TOTAL
FIRMS la]
20.000 [g]
20,000
20,000
20.000
20,000
tasaaaaaaaaaaai
20.000
20,000
20,000
200 [k]
200
200
P
TOTAL
INDUSTRY
HOURS
(P=A*H*O) [b]
800,000
1,600,000
2.400.000
1.120,000
160,000
1,280,000
800.000
800.000
:==========ss:
4,480,000
1,600,000
800,000
3,200
240
2,403,440
1,600
10,400
Q
TOTAL
INDUSTRY
DOLLARS
(Q=P**50) tcl
40,000.000
80.000.000
120.000,000
56,000,000
8,000,000
64,000.000
40.000,000
40,000,000
S224, 000,000
80.000,000
40,000,000
160,000
12.000
120,172,000
80,000
520,000
TOTAL
R
TOTAL
INDUSTRY
COST
(R=D+G+K+N+0)[d]
40,508,000
81,016,000
121,524,000
56,711,200
8,101,600
64.812.800
40,508,000
40,508,000
(226,844,800
81,016,000
40,508,000
162,032
12,180
121,698.212
81,200
527.800
                                                                   2.SUBTOTAL
                                                                                                     120
                                                                                                               6.000
                                                                                                                                           12,000
600,000
                                                                                                                                                                          609.000

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                                                                           EXHIBIT 8 (CONTINUED)

                                                                           CFC CONTROL OPTIONS
                                                                           DIRECT REGULATION
                                                                           INDUSTRY ADMINISTRATIVE BURDEN
3.
                         ACTIVITIES
Respond to EPA Monitoring of Total  Controlled Substance Use
(producers/ Importers )
A.   Research and conpile information
B.   Prepare response to Section 114 letter
C.   Send information to EPA
                                                                3. SUBTOTAL
                             TOTAL INDUSTRY OPERATIONS

                             TOTAL INDUSTRY START-UP AND OPERATIONS

L
TOTAL
FIRMS [a]

o
0
0



STERILIZATION
H
TOTAL
INDUSTRY
HOURS

-------
                                   EXHIBIT 8

                               DIRECT REGULATION
                           EPA ADMINISTRATIVE BURDENS
                                   FOOTNOTES
    Total EPA Hours represents the Number of Occurrences per year x EPA Hours
    per Occurrence.  (C = AxB)

b/
    Total EPA Dollars represents Total EPA hours x $30.45.  $30.45 represents
    the hourly rate of pay of a government employee at Grade 10, step 7, which
    is $14.50 per hour, and an overhead rate of 110 percent.  Source:  EPA
    Appendix D.28.1:  Preparing Information Collection Requests.  (D = Cx$30.45)

c/
    Total Contractor Hours represents the Number of Occurrences per year x
    Contractor Hours per Occurrence.  (F = AxE)

d/
    Total Contractor Dollars represents Total EPA Hours x $50.00.  $50.00
    represents an average hourly rate of pay for a contractor.  (G = Fx$50.00)

e/
    Total Agency Costs represents the sum of Total EPA Dollars and Total
    Contractor Dollars.  (H = D+G)

£/
    There are assumed to be 100 packaging firms, 154 sterilization firms, and
    20,000 large automobile air conditioning shops.  Total number of covered
    firms = 20,254.  It is assumed that reports can be logged at a rate of 15
    per hour.

£/
    Evaluating adequacy of compliance plans assumes that the contractor will
    review one every three hours, and EPA will review four per hour.

V
    Notifying firms of review assumes that the contractor will spend 90 minutes
    per firm preparing a letter with the results of the compliance review and
    EPA will spend 320 hours total on review and oversight activities.

i/
    Number of reports received per year is based on the assumption that firms
    will be required to submit reports quarterly.

I/
    Receiving and logging reports assumes that reports can be logged in at a
    rate of 15 per hour.

k/
    The EPA and contractor hours assume that the contractor will spend 3 hours,
    and EPA will spend an average of five minutes, per firm on this activity.

-------
                                     -4-
i/
   • Number of enforcement actions involving penalties assumes there is a ten
    percent probability that any one firm will be required to pay a penalty for
    a violation.

m/
    Number of enforcement actions involving litigation assumes there is a five
    percent probability that any one firm will be involved in litigation
    regarding a violation.

-------
                                                                                              EXHIBIT 9

                                                                                              CFC CONTROL OPTIONS
                                                                                              Allocated Quotas and Regulatory Fees Hybrid
                                                                                              EPA Administrative Burdens
                                  ACTIVITIES
START-UP PHASE
1.   Establish Production Quotas and  Initial Fee Level, and Refine Formula for
     Adjusting Fee Level
     A.   Calculate base  year allocations based on  relative shares of historic
          market
     B.   Review available data regarding the economics of the controlled
          substance industry and historical  impacts of changing controlled
          substance prices
     C.   Review existing controlled  substance model and  revise as necessary  to
          use in estimating appropriate  fee  levels
     D.   Run model to estimate fee levels
     E.   Finalize Initial fee and self-adjusting formula contained  in  final
          rule
     F.   Determine schedule and procedures  for periodic  reassessment of the
          self-adjusting  formula
     G.   Notify producers/importers  of  final allocations of  production and
          consumption quotas, and fee levels
               Prepare allocations
               Send allocations
               Answer inquiries
2.   Design Tracking and Transfer System
     A.   Design computer system
     B.   Design process for establishing quota accounts
     C.   Develop procedures for reviewing and approving  requests  for
          consumption, production, and conversion rights,  and for  transfers
               Define information that producers/importers must  provide to EPA
               Determine process for requesting transfers
               Design and test forms and instructions for conducting transfers
               Design process for notifying firms of  completed transfer activity
     D.   Develop tracking routine
               Design routine to check transfer requests  against balances and
               "flag" any problems
               Design routine to modify accounts
                                                                                1. SUBTOTAL

A
NUMBER OF
OCCURRENCES
PER YEAR
1.00
1.00
1.00
1.00
1.00
1.00
1.00


1.00
1.00
1.00
1.00


B
EPA
HOURS PER
OCCURRENCE
64
64
960
320
480
160
496
160
16
320

192
32
200
64
32
96
8
160
96
64
EPA
C
TOTAL
EPA
HOURS
(C=A*B) [a]
64
64
960
320
480
160
496

2,544
192
32
200
160


D
TOTAL
EPA
DOLLARS
(D=C**30.45Hb)
1,949
1,949
29,232
9,744
14,616
4,872
15,103

177,465
5,846
974
6,090
4,872


E
CONTRACTOR
HOURS PER
OCCURRENCE
600
960
3,600
2,400
2,400
600
1,500
1,500
0
0

1,800
300
1.860
600
300
900
60
1,500
900
600
CONTRACTOR
F
TOTAL
CONTRACTOR
HOURS
(F=A«E)lcI
600
960
3.600
2,400
2.400
600
1,500

12,060
1,800
300
1,860
1,500


G
TOTAL
CONTRACTOR
DOLLARS
CG=F**50.00)(d]
30,000
48,000
180,000
120,000
120,000
30,000
75,000

$603,000
90,000
15.000
93,000
75,000

TOTAL
H
TOTAL
AGENCY
COST
(H=D+G)(el
31.949
49,949
209,232
129,744
134,616
34,872
90,103

4680,465
95,846
15,974
99,090
79,872

                                                                                2.SUBTOTAL
                                                                                                                               584
                                                                                                                                       S17.783
                                                                                                                                                                         5,460     1273,000
                                                                                                                                                                                                      (290,783

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                                                                                         EXHIBIT 9 (CONTINUED)

                                                                                         CFC CONTROL OPTIONS
                                                                                         Allocated Quotas and Regulatory Fees Hybrid
                                                                                         EPA Administrative Burdens
                              ACTIVITIES
                       EPA

                        C
                                                                                          NUMBER OF        EPA       TOTAL      TOTAL
                                                                                         OCCURRENCES    HOURS PER     EPA        EPA
                                                                                          PER YEAR     OCCURRENCE    HOURS     DOLLARS
                                                                                                                  (C-A*B)[al 
-------
                                                                                              EXHIBIT 9 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Allocated Quotas and Regulatory  Fees  Hybrid
                                                                                              EPA Administrative Burdens
                                  ACTIVITIES
OPERATIONS PHASE
1.   Set up Tracking System and Establish Accounts  for All  Producers/Importers


2.   Track Requests for Consunption,  Production,  and Conversion Rights, and
     for Transfers
     A.   Receive requests for transfers and additional  rights
     B.   Evaluate requests and required documentation
     C.   Examine "problem" requests  and notify firms
     D.   Modify records
     E.   Notify producers/importers  of  approval
1. SUBTOTAL
3.   Conduct Compliance Monitoring Activities
     A.   Receive and review reports on fee payments,  production and  shipments,
          use of raw materials, total consumption rights,  potential
          production rights, production rights,  conversion rights, and data on
          recoverable and recyclable material
     B.   Receive and review reports on import and export  activities
     C.   Verify fee payment reports with U.S. Treasury records
     0.   Obtain additional information from producers/importers/exporters  as
          needed
     E.   Evaluate data on production/consumption levels and fees paid
          to ensure that fees submitted reflect  actual production/consumption
          levels (includes checking calculations of fee payments)
     F.   Notify firms of delinquent or incorrect fee  payments
     G.   Conduct site visits to ensure production/import/export levels  and
          fee payments are consistent with records
               Schedule site visits
               Plan site visit activities
               Conduct site visits
     H.   Evaluate data on production/import/export levels (from reports,
          in-house tracking systems, and site visits)  to ensure that  firms  have
          complied with their quotas.  Examine  import/export records; reconcile
          differences; account for destruction
                                                                                2.SUBTOTAL
EPA
A BCD
NUMBER OF EPA TOTAL TOTAL
OCCURRENCES HOURS PER EPA EPA
PER YEAR OCCURRENCE HOURS DOLLARS
Ie]
     8,609

    $8,609


   105,860
   247,102
   599,170
     4,942
   130,570

t1.087,644

   171,662
                                                                                                                       111.031
                                                                                                                        94,231
                                                                                                                       109,578

                                                                                                                       195,787
                                                                                                                       114,424
                                                                                                                        51.156
                                                                                                                       271,387
                                                                                                                    tl.119,257

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                                                            EXHIBIT 9 (CONTINUED)

                                                            CFC CONTROL OPTIONS
                                                            Allocated Quotas and Regulatory Fees Hybrid
                                                            EPA Administrative Burdens
ACTIVITIES
4.   Revise Self-Adjusting Formula as Necessary
     A.    Determine  If  fee levels (as determined by self-adjusting formula) are
          yielding revenue to capture windfall profits and  if formula needs to
          be revised
     B.    Prepare formula revisions as necessary, based on  results of analysis,
          or based on changes in regulations


5.   Take Enforcement Action as Needed
     A.    Levy penalties (includes notification, documentation, calculations,
          and negotiations)
     B.    Conduct litigation (includes notification, documentation, negotiation,
          and preparation for litigation)
                                             4. SUBTOTAL
                                             4. SUBTOTAL

                TOTAL EPA OPERATIONS
                TECHNICAL AND ADMINISTRATIVE SUPPORT IN
                TRAVEL COSTS
                TOTAL EPA OPERATIONS (including travel and support costs)

                TOTAL EPA START-UP AND OPERATIONS
                TOTAL EPA FTE (HOURS/2080)

A B
NUMBER OF EPA
OCCURRENCES HOURS PER
PER YEAR OCCURRENCE
1.00 6
1 .00 160

Z.OO [p] 160
1.00 (ql 2,080

iupport costs)

EPA
C
TOTAL
EPA
HOURS
(C°A*B)[ai
6
160
166
320
2.080
2,400
24,202
6,689
30,891
15.395
17.02

D
TOTAL
EPA
DOLLARS
<0=C'$30.45)(b]
183
4,872
$5.055
9,744
63,336
(73,080
$736,945
1203,680
$14,840 [si
$955,465
tl, 092,612
CONTRACTOR
E F
CONTRACTOR TOTAL
HOURS PER CONTRACTOR
OCCURRENCE HOURS
(F»A*E)[C]
20 20
4,800 4,800
4,820
0 0
0 0
0
35,954
35,954
65.474

G
TOTAL
CONTRACTOR
DOLLARS
(G=F*t50.00)[d]
1.000
240,000
$24 1.000
0
0
$0
$1,797.700
$1.797.700
$3.273.700
TOTAL
H
TOTAL
AGENCY
COST
(H=0+G)[e]
1.183
244.872
$246,055
9,744
63,336
$73,080
$2,534,645
$203.680
$14.840
$2,753.165
$4,366.312

-------
                                                                                              EXHIBIT 9 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Allocated Quotas and Regulatory Fees Hybrid
                                                                                              Industry Administrative Burdens
                                  ACTIVITIES
START-UP PHASE
1.   Evaluate Expected Impact  of Production Ouotas and Fees on Operations
     A.   Analyze ittpact  of limits  and  fees
     B.   Plan operational  response to  limits  and fees
     C.   Plan transfer and export  activities


2.   Design Internal Fee Payment System
     A.   Set up system for determining fee amount owed
     B.   Set up accounting system  to pay correct fee amounts to U.S. Treasury
                                                                               1.SUBTOTAL
3.   Design System to Heet EPA Reporting and Compliance Monitoring Requirements
     A.   Develop in-house system to track  production/consunption levels, and
          fees paid
     B.   Design reporting system to meet EPA  requirements
                                                                               2. SUBTOTAL
                                                                               3. SUBTOTAL
                                                  TOTAL  INDUSTRY START-UP
OPERATIONS PHASE
1.   Implement Operational  Changes  Necessary  to Comply with Regulations and
     Fee System


2.   Pay Fees Based on Production/Import  Levels
     A.   Determine fee amounts owed
     B.   Disburse fee amounts to the U.S.  Treasury with  appropriate paperwork
     C.   Notify EPA of payment
                                                                                1.SUBTOTAL

A
NUMBER OF
OCCURRENCES
PER YEAR






1.00
1.00
1.00
1.00
1.00
t.OO
1.00
1.00
4.00
4.00
4.00

B
PRODUCER
HOURS PER
OCCURRENCE
200
£00
160
120
80
160
40
600
[fl 16
2
PRODUCER
C
TOTAL
PRODUCER
HOURS

-------
                                                                                              EXHIBIT 9 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Allocated Quotas and Regulatory Fees Hybrid
                                                                                              Industry Administrative Burdens
                                  ACTIVITIES
3.
5.
6.
Conduct Transfer Transactions
A.   Prepare and submit transfer request  to EPA
B.   Obtain EPA approval for transfer
C.   Modify records regarding Inventory of production and consumption
     rights


Obtain Additional Consumption Rights through Exports
A.   Prepare and submit request and proof of exports of controlled
     substances
B.   Obtain additional consumption rights from EPA


Convert Potential Production Rights into  Production Rights through Exports
to Parties (Additional Production Rights  are Granted through Transactions
with 25 Kilotorme Parties)
A.   Obtain production reduction documentation from embassy
8.   Prepare and submit request end proof of exports of controlled
     substances
C.   Obtain notice of production rights from EPA
                                                                               3.SUBTOTAL
                                                                                (.SUBTOTAL
Comply with EPA Reporting and Compliance Monitoring Requirements
A.   Maintain records of fees paid, production, raw materials used, sales,
     shipments, controlled substances recovered and recycled, and import
     and export activities
B.   Prepare and submit reports on fees paid, production, feedstock
     consumption, shipments, total consumption rights, potential production
     rights, production rights, conversion rights, and data on recoverable
     and recyclable materials
C.   Prepare and submit reports on import end export activities
0.   Provide additional Information requested by EPA
E.   Prepare for EPA site visits
F.   Accommodate EPA site visits
G.   Disburse additional or corrected fee amounts to U.S. Treasury
                                                                                5. SUBTOTAL

A
NUMBER OF
OCCURRENCES
PER YEAR
75.29
75.29
75.29

75.29
75.29

1.00
1.00
1.00

4.00
4.00
4.00
2.00
1.00
1.00
0.40

B
PRODUCER
HOURS PER
OCCURRENCE
Cg] 5
1

[h] 5
2

(il 40
40
2

0
Ik) 8
40
[m] 24
32
16
[o] 24
PRODUCER
C
TOTAL
PRODUCER
HOURS

-------
                                                                                              EXHIBIT 9 (CONTINUED)

                                                                                              CFC CONTROL OPTIONS
                                                                                              Allocated Quotas and Regulatory Fees Hybrid
                                                                                              Industry Administrative Burdens
                                  ACTIVITIES
7.   Respond to any Enforcement Activity
     A.   Pay penalties  (Includes negotiation)
     B.   Conduct  litigation  (includes negotiation, preparation  for litigation)

                                                                               /.SUBTOTAL

                                               TOTAL  INDUSTRY OPERATIONS

                                               TOTAL  INDUSTRY START-UP AND OPERATIONS

A
NUMBER OF
OCCURRENCES
PER YEAR
0.10
0.05




B
PRODUCER
HOURS PER
OCCURRENCE
[pi 160
[q] 2,080



PRODUCER
C
TOTAL
PRODUCER
HOURS
(C=A«B«7)[al
112
728
840
16,499
26,019

D
TOTAL
PRODUCER
DOLLARS
(D=C*$50) [b]
5,600
36.400
$42.000
$824,933
$1,300,933

E
IMPORTER
HOURS PER
OCCURRENCE
40
1,040



IMPORTER
F
TOTAL
IMPORTER
HOURS
(F=A*E*14)tc3
56
728
784
26,356
35,456

G
TOTAL
IMPORTER
DOLLARS
(G=F*$50) [d]
2,800
36,400
$39,200
$1,317,785
$1,772,785
TOTAL
H
TOTAL
INDUSTRY
COST

-------
                                   EXHIBIT 9

                  ATJ.nr.ATEn QUOTAS AMD REGULATORY FEES HYBRID
                           EPA ADMINISTRATIVE BURDENS
                                   FOOTNOTES
    Total EPA Hours represents the Number of Occurrences per year x EPA Hours
    per Occurrence.  (C = AxB)

by
    Total EPA Dollars represents Total EPA hours x $30.45.  $30.45 represents
    the hourly rate of pay of a government employee at Grade 10, step 7, which
    is $14.50 per hour, and an overhead rate of 110 percent.  Source:  EPA
    Appendix D.28.1:  Preparing Information Collection Requests.  (D = Cx$30.45)

£/
    Total Contractor Hours represents the Number of Occurrences per year x
    Contractor Hours per Occurrence.  (F - AxE)

d/
    Total Contractor Dollars represents Total EPA Hours x $50.00.  $50.00
    represents an average hourly rate of pay for a contractor.  (G = Fx$50.00)

e/
    Total Agency Costs represents the sum of Total EPA Dollars and Total
    Contractor Dollars.  (H = D+G)

V
    Establishing accounts for 21 producers/importers assumes it will take one
    hour of EPA time plus contractor support to set up each account.

g/
    Number of requests for transfers and additional rights is based on the
    assumption that producers and importers choose to conduct transactions three
    times per year, and that 30 exporters will request, receive, and
    subsequently trade, consumption rights weekly to producers/importers.
    Hence, (7 producers x 3) + (14 importers x 3) + (30 exporters x 52) = 1,623
    transactions per year.

by
    Number of problem transactions assumes 20 percent of the requests will be
    flagged as problems.  Hence, (1,623 transactions x .20) = 325 problems per
    year.

i/
    Number of reports received per year is based on the assumption that
    producers/importers will be required to submit reports quarterly.  Hence,
    (21 producers/importers x 4) = 84.

i/
    Verification of fee payment reports will be conducted quarterly when reports
    are submitted.  Hence, (21 producers/importers x 4) - 84.

-------
                                     -2-
   .Number of times EPA will require additional information assumes there is a
    50 percent probability each quarter that any one firm will need to provide
    additional information to meet EPA reporting requirements.  Hence, [(.50 x 7
    producers) + (.50 x 14 importers) x 4] =42 additional information requests
    per year.

I/
    Number of times EPA will evaluate data on production/import levels assumes
    evaluations will occur quarterly.  Hence, (21 producers/importers x 4) ~ 84.

m/
    Number of notices assumes that there is a 20 percent probability each
    quarter that any one producer or importer will make a delinquent or
    incorrect fee payment.  Hence, [(.2 x 7 producers) + (.2 x 14 importers) x
    4] = 17 notices will be issued per year.

S/
    Number of site visits assumes one visit per year to each of the seven
    producers, and one visit to the 14 importers.  Estimate assumes site visits
    are made to two facilities per producer.  Hence, (2x7 producers) + (1 x 14
    importers) = 28 site visits per year.

o/
    Number of times EPA will evaluate data on production/import levels assumes
    evaluation will occur quarterly for 21 producers/importers.  Hence, (21
    producer/importers) x 4 = 84.

E/
    Number of enforcement actions involving penalties assumes there is a ten
    percent probability that any one producer or importer will be required to
    pay a penalty for a fee or rights violation.  On average, therefore, EPA is
    expected to levy two penalty actions per year.  Hence, (.10 x 7 producers) +
    (.10 x 14 importers) = 2 penalty actions per year.

a/
    Number of enforcement actions involving litigation assumes there is a five
    percent probability that EPA will conduct litigation against any one
    producer or importer regarding a fee or rights violation.  On average,
    therefore, EPA is expected to conduct 1 litigation action per year.  Hence,
    (.05 x 7 producers) + (.05 x 14 importers) = 1 litigation action.

£/
    EPA will maintain adequate technical and administrative support to implement
    this program.  Such support shall include timely responses to requests for
    information, procedural inquiries and program implementation workshops, and
    technical support to address data management concerns.  FTE level equals 50
    percent of operational FTE levels.

s/
    Travel costs include $310 for airfare, $50 for care rental, and $85 for per
    diem for two days for a total of $530 each trip, or $14,840 for 28 trips.

-------
                                     -3-
                  ALLOCATED QUOTAS AND REGULATORY FEES HYBRID
                        INDUSTRY ADMINISTRATIVE BURDENS
                                   FOOTNOTES
a/
    Total Producer Hours represents the Number of Occurrences per year x
    Producer Hours per Occurrence x seven producers.  (C - AxBx7)

by
    Total Producer Dollars represents Total Producer Hours x $50.00.  $50.00
    represents an average hourly rate of pay for a private firm.  (D = C x
    $50.00)

£/
    Total Importer Hours represents the Number of Occurrences per year x
    Importer Hours per Occurrence x 14 importers.  (F - AxExl4)

d/
    Total Importer Dollars represents Total Importer Hours x $50.00.  $50.00
    represents an average hourly rate of pay for a private firm.  (G - Fx$50.00)

e/
    Total Industry Costs represents the sum of Total Producer Dollars and Total
    Importer Dollars.  (H = D+G)

f/
    Number of fee payments is based on the assumption that quarterly payments
    will be made to EPA.

£/
    Number of transfer transactions is based on the assumption that
    producers/importers choose to conduct transactions one time per year, and 30
    exporters will transfer consumption rights weekly.  Hence, (7 producers x 1)
    + (14 importers x 1) + (30 exporters x 52) * 21 producers/importers = 75.29
    transactions per year.

h/
    Number of requests to obtain additional consumption rights through exports
    assumes that firms will conduct such activities one time per year, and that
    30 exporters will request, receive, and subsequently trade, consumption
    rights weekly to producers/importers.  Hence, (7 producers x 1) + (14
    importers x 1) + (30 exporters x 52) * 21 producers/importers = 75.29
    requests per year.

i/
    Number of requests to convert potential production rights into production
    rights through exports assumes that producers/importers will choose to
    conduct such activities one time per year.

i/
    Firms will maintain data for EPA in the same format as collected for their
    internal use.  Hence, this activity will require no additional time.

-------
                                     -4-
k/
    Number of reports compiled and submitted per year is based on the assumption
    that producers/importers will be required to submit reports quarterly.

I/
    Firms will submit report data quarterly in the same format as collected for
    internal use.  EPA will not require a specific form for data on production
    and import/export activities, but will specify the format for reporting
    payment of fees.  This number assumes 8 hours per quarter per firm to
    package and mail the information to EPA on production and import/export
    activities,  and fee payments.

B/
    Number of additional information requests assumes that there is a 50 percent
    probability each quarter that producers/importers will need to provide
    additional information to EPA quarterly.

S/
    Hours for site visits assumes one visit per. year to each of the seven
    producers and 14 importers.  Each producer is assumed to have two
    facilities.   Total producer hours, therefore, are multiplied by two to
    represent 14 visits.

fl/
    Number of additional or corrected fee amounts submitted assumes that 10
    percent of producers and importers will be required to submit additional
    payments quarterly.  Hence, (.10 x 4) = .4 additional payments per firm.

B/
    Number of enforcement actions involving penalties assumes there is a ten
    percent probability that any one producer or importer will be required to
    pay a penalty for a fee or rights violation.

a/
    Number of enforcement actions involving litigation assumes there is a five
    percent probability that any one producer or importer will be involved in
    litigation regarding a fee or rights violation.

-------
                                                                                           EXHIBIT  10

                                                                                           CFC CONTROL OPTIONS
                                                                                           Allocated Quotas and Direct Regulation Hybrid
                                                                                           EPA Administrative Burdens
                                    ACTIVITIES
START-UP PHASE
1.   Establish Production Quotas
     A.   Calculate base year allocations  based on relative  shares  of historic
          market
     B.   Notify  producers/importers of  final  allocations  of production quotas
               Prepare allocations
               Send allocations
               Answer inquiries
2.   Design Tracking and Transfer System
     A.   Design computer system
     B.   Design process for establishing quota accounts
     C.   Develop procedures for reviewing and approving  requests  for
          consumption,  production,  and conversion rights,  and for  transfers
               Define information that producers/importers must  provide to EPA
               Determine process for requesting transfers
               Design and test forms and instructions for conducting transfers
               Design process for notifying firms of  approved transfer  activity
     D.   Develop tracking routine
               Design routine to check transfer requests  against account balances
               and "flag" any problems
               Design routine to modify accounts


3.   Design Recordkeeping and Compliance Monitoring System
     A.   Develop detailed design of system
               Define information that producers/importers must  provide on
               produetion/consunption levels,  and establish  format for  entering
               data
               Set up data base for monitoring production/consumption levels
               and transfer activities
               Develop guidelines for determining whether a  violation has
               occurred
     B.   Develop instructions for preparation of information on production,
          sales, shipments, use of raw materials, total consumption rights,
          potential production rights, production rights,  conversion rights, and
          data on recoverable and recyclable materials
                                                                                  1. SUBTOTAL
2.SUBTOTAL

A
NUMBER OF
OCCURRENCES
PER YEAR
1.00
1.00
L
1.00
1.00
1.00
1.00

L
1.00


1.00

B
EPA
HOURS PER
OCCURRENCE
64
496
160
16
320

192
32
200
64
32
96
B
160
96
64

592
192
256
144
96
EPA
C
TOTAL
EPA
HOURS
(C=A*B)[a]
64
496
560
192
32
200
160

584
592


96

D
TOTAL
EPA
DOLLARS
CD=C*$30.«5)Ib]
1,949
15,103
17,052
5,846
974
6,090
4,872

SI 7. 783
18.026


2,923

E
CONTRACTOR
HOURS PER
OCCURRENCE
600
1,500
1,500
0
0

1,800
300
1,860
600
300
900
60
1,500
900
600

5.550
1,800
2,400
1,350
900
CONTRACTOR
F
TOTAL
CONTRACTOR
HOURS

-------
                                   ACTIVITIES
     C.   Develop  instructions for obtaining information on import and export
         activities
     D.   Determine site visit policies (for monitoring compliance)
              Define purpose, items to be inspected, duration of visit, develop
              schedules, design notices to producers/importers
     E    Design operational guidelines for the violation and penalty system
     F    Design compliance plan format
     G    Develop  criteria for evaluating adequacy of compliance plans
     H    Design compliance report format
         Develop  criteria for determining adequacy of compliance reports
         Develop  policy and protocol for site visits
                                                                                           EXHIBIT 10 (CONTINUED)

                                                                                           CFC CONTROL OPTIONS
                                                                                           Allocated Quotas  and Direct Regulation Hybrid
                                                                                           EPA Administrative Burdens
           NUMBER OF
          OCCURRENCES
           PER TEAR
                1.00

                1.00
                1.00
                1.00
                1.00
                1.00
                1.00
                1.00
i.    Develop Enforcement and Litigation Policies


i.    Design  Guidelines and Permitting Procedures for Destruction and Permanent
     Encapsulation of Controlled Substances
                                      TOTAL EPA START-UP
OPERATIONS PHASE
I.    Receive  and  Log Compliance Plans


2.    Evaluate the Adequacy of Compliance Plans


i.    Notify Firms of Results of Compliance Plan Review


I.    Set  Up Tracking System and Establish Accounts for All Producers/Importers
3.SUBTOTAL


4.SUBTOTAL



5.SUBTOTAL







1.SUBTOTAL


2.SUBTOTAL


3.SUBTOTAL


4.SUBTOTAL
1.00


1.00
1.00


1.00


1.00


1.00

EPA
CONTRACTOR
BCD E F G
EPA TOTAL TOTAL CONTRACTOR TOTAL TOTAL
HOURS PER EPA EPA HOURS PER CONTRACTOR CONTRACTOR
OCCURRENCE HOURS DOLLARS OCCURRENCE HOURS DOLLARS
CC=A«BHa] (D°C*$30.45)lbl [el
39,936
47,923
111,821
80,974
40,487
40,487
40,487
80,974
S826.540
92,436
$92,436
91,462
S91.462
$1,423,272
40,803
$40,803
3,168.011
$3,168,011
1.517.Z44
$1.517.244
8,609
                                                                                                                                     20
                                                                                                                                                $609
                                                                                                                                                                                       160
                                                                                                                                                                                                 (8,000
                                                                                                                                                                                                                        (8,609

-------
                                   ACTIVITIES
                                                                                           EXHIBIT 10 (CONTINUED)

                                                                                           CFC CONTROL OPTIONS
                                                                                           Allocated Quotas and Direct Regulation Hybrid
                                                                                           EPA Administrative Burdens
                                                                                                                                EPA

                                                                                                                                 C
 NUMBER OF
OCCURRENCES
 PER YEAR
                                                                                                                   B
                    EPA          TOTAL
                 HOURS PER         EPA
                 OCCURRENCE       HOURS
                              [8]
          TOTAL
           EPA
         DOLLARS
      (D=C*S30.4S)[bl
                                  CONTRACTOR

                       E              F            G

                  CONTRACTOR        TOTAL        TOTAL
                   HOURS PER      CONTRACTOR  CONTRACTOR
                  OCCURRENCE        HOURS       DOLLARS
                                  (F=A*EHcl  
-------
                                                                                       EXHIBIT 10 (CONTINUED)

                                                                                       CFC CONTROL OPTIONS
                                                                                       Allocated Quotas and Direct Regulation Hybrid
                                                                                       EPA Administrative Burdens
                               ACTIVITIES
Take Enforcement Action as Needed
 A.   Levy penalties
 B.   Conduct litigation
                                                                             /.SUBTOTAL

                                   TOTAL EPA OPERATIONS
                                   TECHNICAL AND ADMINISTRATIVE SUPPORT  [V]
                                   TRAVEL COSTS
                                   TOTAL EPA OPERATIONS (including travel and support costs)

                                   TOTAL EPA START-UP AND OPERATIONS
                                   TOTAL EPA FIE (HOURS/2080)

A
NUMBER OF
OCCURRENCES
PER YEAR
22.00 tt]
11.00 [u]
L
MtS)
EPA
B C
EPA TOTAL
HOURS PER EPA
OCCURRENCE HOURS

-------
                                                                                          EXHIBIT 10 (CONTINUED)

                                                                                          CFC CONTROL OPTIONS
                                                                                          Allocated Quotas and Direct Regulation Hybrid
                                                                                          Industry Administrative Burdens
                                   ACTIVITIES
START-UP PHASE
1.   Evaluate Expected Impact of Production Quotas and Regulations
     A.   Analyze impact of limits
     B.   Plan operational response to limits
     C.   Plan transfer and export activities
     D.   Analyze impact of regulations
     E.   Plan operational response to regulations


2.   Prepare and Submit Compliance Plan
     A.  Prepare and submit compliance plan
     B.  Respond to EPA requests for further information


3.   Design System to Heet EPA Reporting and Compliance Monitoring
     Requirements
                                       TOTAL INDUSTRY START-UP
OPERATIONS PHASE
1.   Implement Operational Changes Necessary to Comply with Regulations
2.   Conduct Transfer Transactions
     A.   Prepare and submit transfer requests to EPA
     B.   Obtain EPA approval for transfer
     C.   Modify records
                                                                                           NUMBER OF
                                                                                          OCCURRENCES
                                                                                           PER TEAR
ggggg
1. SUBTOTAL
2.SUBTOTAL
                                                                                3.SUBTOTAL
                 1.00
                 0.50 [k]
                 1.00
                                                                                1.SUBTOTAL
                                                                                2. SUBTOTAL
                 1.00
                75.29 [I]
                75.29
                75.29

B
PRODUCER
HOURS PER
OCCURRENCE
160
400
160
0
0

0
0
0


320

5
2
1
PRODUCER
C
TOTAL
PRODUCER
HOURS
(C=A«B*7)ta]
1.120
2,800
1,120
0
0
5,040
0
0
0
0
0
5,040
2,240
2,240
2,635
1,054
527

D
TOTAL
PRODUCER
DOLLARS
(D=C*S50)lbI
56,000
140,000
56,000
0
0
$252,000
0
0
SO
0
SO
$252,000
112,000
(112,000
131,758
52,703
26,352

E
IMPORTER
HOURS PER
OCCURRENCE
80
200
80
0
0

0
0
0


200

5
2
1
IMPORTER
F
TOTAL
IMPORTER
HOURS
(F=A*E*14)[cl
1.120
2,800
1,120
0
0
5.040
0
0
0
0
0
5.040
2,800
2,800
5.270
2.108
1.054

G
TOTAL
IMPORTER
DOLLARS
CGsF*S50)ldl
56,000
140.000
56,000
0
0
$252,000
0
0
' SO
0
SO
$252,000
140,000
$140,000
263.515
105.406
52,703
                                                                                                                                     4,216
                                                                 $210,812
                                                                                                                                                                                           8.432
$421,624

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                                                                                          EXHIBIT 10 (CONTINUED)

                                                                                          CFC CONTROL OPTIONS
                                                                                          Allocated Quotas and Direct  Regulation Hybrid
                                                                                          Industry Administrative Burdens
                                  ACTIVITIES
!.    Obtain Additional Consumption Rights through Exports
     A.    Prepare  and submit request and proof of exports of controlled
          substances
     B.    Obtain additional consumption rights from EPA


I.    Convert  Potential Production Rights into Production Rights through Exports
     to Parties (Additional Production Rights are Granted through Transactions
     with  25  Kilotonne Parties)
     A.    Obtain production reduction documentation from embassy
     B.    Prepare  and submit request and proof of exports of controlled
          substances
     C.    Obtain notice of production rights from EPA
                                                                                           NUMBER OF
                                                                                          OCCURRENCES
                                                                                           PER YEAR
                75.29 (ml

                75.29
3. SUBTOTAL
     Comply with EPA  Reporting and Compliance Monitoring Requirements
     A.    Maintain records of production, raw materials purchased, sales,
          process  parameters, and import and export activities
     B.    Prepare  and submit reports on production, feedstock consumption,
          shipments,  total consumption rights, potential production rights,
          production  rights, conversion rights, and data on recoverable and
          recyclable  materials
     C.    Prepare  and submit reports on import and export activities
     D.    Provide  additional information requested by EPA
     E.    Users research  and compile information on controlled substance use
     F.    Users prepare and submit reports
     G.    Users provide additional information requested by EPA
     H.    Prepare  for EPA site visits
     I.    Accommodate EPA site visits
                                                                               4.SUBTOTAL
                 1.00 In]
                 1.00

                 1.00
                 4.00

                 4.00
                 4.00
                 2.00 Cq]
                 4.00
                 4.00
                 0.04 (ql
                 1.00
                 1.00

B
PRODUCER
HOURS PER
OCCURRENCE
5
2

40
40
2

0
8
40
24
0
' 0
0
32
16
PRODUCER
C
TOTAL
PRODUCER
HOURS
(C=A*B*7)taJ
2,635
1,054
3,689
280
280
14
574
(oj 0
(pi 224
1,120
336
0
0
0
448
224

D
TOTAL
PRODUCER
DOLLARS
(D=C**50)lb]
131,758
52,703
$184,461
14,000
14.000
700
$28,700
0
11.200
56.000
16.800
0
0
0
Crl 22,400
(rj 11.200

E
IMPORTER
HOURS PER
OCCURRENCE
5
2

40
40
2

0
8
40
8
0
0
0
8
16
IMPORTER
F
TOTAL
IMPORTER
HOURS

-------
                                                                                          EXHIBIT 10 (CONTINUED)

                                                                                          CFC CONTROL OPTIONS
                                                                                          Allocated Quotas and Direct Regulation Hybrid
                                                                                          Industry Administrative Burdens
                                   ACTIVITIES
6.
     Respond to Any Enforcement  Activity
          Pay penalties
          Conduct Litigation
                                                                               6.SUBTOTAL
                                       TOTAL  INDUSTRY OPERATIONS

                                       TOTAL  INDUSTRY START-UP AND OPERATIONS

A
NUMBER OF
OCCURRENCES
PER YEAR
0.10 [u]
0.05 [v]




B
PRODUCER
HOURS PER
OCCURRENCE
160
2.080



PRODUCER
C
TOTAL
PRODUCER
HOURS
(C=A«B*7) [a]
112
728
840
13.911
18.951

D
TOTAL
PRODUCER
DOLLARS

-------
                                                                                           EXHIBIT  10 (CONTINUED)

                                                                                           CFC CONTROL OPTIONS
                                                                                           Allocated Quotas  and Direct Regulation Hybrid
                                                                                           Industry Administrative Burdens
                                   ACTIVITIES
START-UP PHASE
1.   Evaluate Expected Impact of Production Quotas and Regulations
     A.   Analyze impact of limits
     B.   Plan operational response to limits
     C.   Plan transfer and export activities
     D.   Analyze impact of regulations
     E.   Plan operational response to regulations
2.   Prepare and Submit Compliance Plan
     A.  Prepare and submit compliance plan
     B.  Respond to EPA requests for further information
3.   Design System to Meet EPA Reporting and Compliance Monitoring
     Requirements
                                       TOTAL INDUSTRY START-UP
OPERATIONS PHASE
1.   Implement Operational Changes Necessary to Comply with Regulations
2.   Conduct Transfer Transactions
     A.   Prepare and submit transfer requests to EPA
     B.   Obtain EPA approval for transfer
     C.   Modify records
                                                                                1.SUBTOTAL
                                                                                2.SUBTOTAL
                                                                                3.SUBTOTAL
                                                                                1.SUBTOTAL
                                                                                2. SUBTOTAL

PACKAGING
H I
FIRM TOTAL
HOURS PER FIRMS Ce]
OCCURRENCE
(J=A
0
0
0
40
80
56
16
40
0
0
0
0
ooooo
100
100
100

100
0
0
0
AUTOMOBILE AIR CONDITIONING
J
TOTAL
FIRM
HOURS
*H*I>[«
0
0
0
4,000
8,000
12,000
5,600
800
6,400
4,000
4,000
22,400
0
0
0
0
0
K L M N
TOTAL FIRM TOTAL TOTAL
FIRM HOURS PER FIRMS Ce] FIRM
DOLLARS OCCURRENCE HOURS

-------
                                                                                          EXHIBIT 10 (CONTINUED)

                                                                                          CFC CONTROL OPTIONS
                                                                                          Allocated Quotas and Direct Regulation Hybrid
                                                                                          Industry Administrative Burdens
                                   ACTIVITIES
3.
5.
Obtain Additional Consumption Rights through Exports
A.   Prepare and submit request and proof of exports of  controlled
     substances
B.   Obtain additional  consumption rights from EPA


Convert Potential Production Rights into Production Rights  through Exports
to Parties (Additional  Production Rights are Granted through  Transactions
with 25 Kilotome Parties)
A.   Obtain production reduction documentation from embassy
B.   Prepare and submit request and proof of exports of  controlled
     substances
C.   Obtain notice of production rights from EPA


Comply with EPA Reporting and Compliance Monitoring Requirements
A.   Maintain records of production, raw materials purchased,  sales,
     process parameters, and import and export activities
B.   Prepare and submit reports on production, feedstock consunption,
     shipments, total consunption rights, potential production rights,
     production rights, conversion rights, and data on recoverable and
     recyclable materials
C.   Prepare and submit reports on import and export activities
D.   Provide additional information requested by EPA
E.   Users research and compile information on controlled substance use
F.   Users prepare and submit reports
G.   Users provide additional information requested by EPA
H.   Prepare for EPA site visits
I.   Accoomodate EPA site visits
                                                                                3.SUBTOTAL
                                                                                4.SUBTOTAL
PACKAGING
H
FIRM


HOURS PER
OCCURREN

















CE

0
0

0
0
0

0
0
0
0
20
10
8
8
16
1
TOTAL
FIRMS [el


0
0

0
0
0

0
0
0
0
100
100
100
1
1
J
TOTAL
FIRM
HOURS
(J=A*HM)IfJ
0
0
0
0
0
0
0
0
0
0
0
8.000
4,000
32
Is] 8
16
K
TOTAL
FIRM
DOLLARS
 (h)
395,273
158,109
S553.382
42,000
42,000
2.100
186,100
0
33,600
168.000
28,000
80,400.000
40,200,000
321,600
108,400
183,200
                                                                                5.SUBTOTAL
                                                                                                                             12,056    S602.800
                                                                                                                                                                               2.411,200 (120,560.000     S121.442.800

-------
                                                                                     EXHIBIT  10 (CONTINUED)

                                                                                     CFC CONTROL OPTIONS
                                                                                     Allocated Quotas and Direct Regulation Hybrid
                                                                                     Industry Administrative Burdens
                              ACTIVITIES
Respond to Any Enforcement  Activity
     Pay penalties
     Conduct Litigation
                                                                          6.SUBTOTAL
                                  TOTAL  INDUSTRY OPERATIONS

                                  TOTAL  INDUSTRY START-UP AND OPERATIONS

H
FIRM
HOURS PER
OCCURRENCE
80
1.040



PACKAGING
1 J
TOTAL TOTAL
FIRMS le] FIRM
HOURS

-------
                                   EXHIBIT 10

                 ALLOCATED QUOTAS AND DIRECT REGULATION HYBRID
                           EPA ADMINISTRATIVE BURDENS
                                   FOOTNOTES
a/
    Total EPA Hours represents the Number of Occurrences per year x EPA Hours
    per Occurrence.  (C = AxB)

V
    Total EPA Dollars represents Total EPA hours x $30.45.  $30.45 represents
    the hourly rate of pay of a government employee at Grade 10, step 7, which
    is $14.50 per hour, and an overhead rate of 110 percent.  Source:  EPA
    Appendix D.28.1:  Preparing Information Collection Requests.  (D = Cx$30.45)

£/
    Total Contractor Hours represents the Number of Occurrences per year x
    Contractor Hours per Occurrence.  (F = AxE)

d/
    Total Contractor Dollars represents Total EPA Hours x $50.00.  $50.00
    represents an average hourly rate of pay for a contractor.  (G •= Fx$50.00)

e/
    Total Agency Costs represents the sum of Total EPA Dollars and Total
    Contractor Dollars.  (H = D+G)

£/
    There are assumed to be 100 packaging firms, and 20,000 large automobile air
    conditioning shops.  Total number of covered firms is 20,100.  It is assumed
    that reports can be logged in at a rate of 15 per hour.

£/
    Evaluating adequacy of compliance plans assumes that the contractor will
    review one every three hours, and EPA will review four per hour.

by
    Notifying firms of review assumes that the contractor will spend 90 minutes
    per firm preparing a letter with the results of the compliance review and
    EPA will spend 320 hours total on review and oversight activities.

i/
    Number of requests for transfers and additional rights is based on the
    assumption that producers and importers choose to conduct transactions three
    times per year, and that 30 exporters will request, receive, and
    subsequently trade, consumption rights weekly to producers/importers.
    Hence, (5 producers x 3) + (15 importers x 3) + (30 exporters x 52) = 1,623
    transactions per year.

j/
    Number of problem transactions assumes 20 percent of the requests will be
    flagged as problems.  Hence, (1,623 transactions x .20) = 325 problems per
    year.

-------
                                     -2-
k/
    Number of reports received per year is based on the assumption that
    producers/importers will be required to submit reports quarterly.

I/
    Number of times EPA will require additional information assumes there is a
    50 percent probability that any one firm will need to provide additional
    information to meet EPA requirements.  Hence, (.50 x 7 producers) + (.50 x
    14 importers) x 4 = 42 additional information requests per year.

a/
    Number of site visits assumes one visit per year to each of the seven
    producers, and one visit per year to each of the 14 importers.  Each
    producer is assumed to have two facilities.  Hence, (1x7 producers x 2) +
    (1 x 14 importers) - 28 site visits per year.

S/
    Number of times EPA will evaluate data on production/import levels assumes
    evaluation will occur quarterly for 21 producers/importers.  Hence, (21
    producer/ importers) x 4 = 84.

fi/
    Number of reports reviewed per year is based on the assumption that
    packaging and automobile air conditioning firms will be required to submit
    reports quarterly.

B/
    Receiving and logging reports assumes that reports can be logged by EPA at a
    rate of 15 per hour.

a/
    Evaluating adequacy of reports assumes that the contractor will spend 3
    hours, and EPA will spend an average of five minutes, per firm on this
    activity.

£/
    Notifying firms of review assumes that the contractor will spend 1 hour per
    firm preparing a letter with the results of the compliance report review.

s/
    Number of site visits assumes that one percent of the automobile air
    conditioning firms will be visited and that one percent of the packaging
    firms will be visited.  (20,000 x .01) + (100 x .01) = 201 site visits.
    Number of enforcement actions involving penalties assumes there is a ten
    percent probability that any one producer, importer, packaging firm or
    automobile air conditioning firm will be required to pay a penalty for a
    violation.  On average, therefore, EPA is expected to levy 22 penalties per
    year.  Hence, (.10 x 7 producers) + (.10 x 14 importers) + (.10 x 201
    visited packaging and automobile air conditioning firms) = 22 penalty
    actions per year.

-------
                                     -3-


U/
    Number of enforcement actions involving litigation assumes there is a five
    percent probability that EPA will conduct litigation against any one
    producer, importer, packaging firm, or automobile air conditioning firm
    regarding a violation.  On average, therefore, EPA is expected-to conduct 11
    litigation actions per year.  Hence, (.05 x 7 producers) + (.05 x 14
    importers) + (.05 x 201 visited packaging and automobile air conditioning
    firms) - 11 litigation actions.

Y/
    EPA will maintain adequate technical and administrative support to implement
    this program.  Such support shall include timely responses to requests for
    information, procedural inquiries and program implementation workshops, and
    technical support to address data management concerns as the program
    develops.  FTE levels equal 50 percent of operational FTE levels.

w/
    Travel costs include $310 for airfare,  $50 for car rental, and $85 for per
    diem for two days for a total of $530 each trip, or $106,530 for 201
    trips.

-------
                                     -4-
                 ALLOCATED QUOTAS AND DIRECT REGULATION HYBRID
                        INDUSTRY ADMINISTRATIVE BURDENS
                                   FOOTNOTES

a/
    Total Producer Hours represents the Number of Occurrences per year x
    Producer Hours per Occurrence x seven producers.  (C = AxBx?)
    Total Producer Dollars represents Total Producer Hours x $50.00.  $50.00
    represents an average hourly rate of pay for a private firm.  (D = C x
    $50.00)

£/
    Total Importer Hours represents the Number of Occurrences per year x
    Importer Hours per Occurrence x 14 importers.  (F ~ AxExl4)

d/
    Total Importer Dollars represents Total Importer Hours x $50.00.  $50.00
    represents an average hourly rate of pay for a private firm.  (G = Fx$50.00)

e/
    Total Firms represents the total number of firms in each industry involved
    in an activity.

£/
    Total Firm Hours represents the Number of Occurrences per year x Firm Hours
    Per Occurrence x Total Firms.  (J = AxHxI, N = AxLxM)

£/
    Total Firm Dollars represents Total Firm Hours x $50.00.  $50.00 represents
    an average hourly rate of pay for a private firm.  (K = J x $50.00, 0 =
    Nx$50.00).
    Total Industry Costs represents the sum of Total Producer Dollars, Total
    Importer Dollars, and Total Firm Dollars.  (P = D+G+K+0) .

i/
    The total number of firms in the packaging industry to be affected by direct
    regulation is estimated at 100.

i/
    The total number of large automotive shops in the automobile air
    conditioning industry to be affected by direct regulation is estimated at
    20,000.

k/
    Number of additional information requests assumes that there is a 50 percent
    probability that firms will need to provide additional information to meet
    EPA requirements.

-------
                                     -5-
i/
    Number of transfer transactions is based on the assumption that
    producers/importers choose to conduct transactions one time per year, and
    that 30 exporters will transfer consumption rights weekly.  Hence, (7
    producers x 1) + (14 importers x 1) + (30 exporters x 52) * 21 •
    producers/importers = 75.29 transactions per year.

!/
    Number of requests to obtain additional consumption rights through exports
    assumes that firms will conduct such activities one time per year, and that
    30 exporters will request, receive, and subsequently trade, consumption
    rights weekly to producers/importers.  Hence, (7 producers x 1) + (14
    importers x 1) + (30 exporters x 52) * 21 producers/importers = 75.29
    requests per year.

U/
    Number of requests to convert potential production rights into production
    rights through exports assumes that producers/importers will choose to
    conduct such activities one time per year.

fi/
    Firms will maintain data for EPA in the same format as collected for their
    internal use.  Hence, this activity will require no additional time.

E/
    Firms will submit report data quarterly in the same format as collected for
    internal use.  EPA will not require a specific form.  This number assumes 4
    hours per quarter per firm to package and mail the information to EPA.

£/  Number of additional information requests assumes that there is a 50 percent
    probability each quarter that producers/importers will need to provide
    additional information to EPA quarterly.  Hence, (.50 x 4) - 2.  For
    packaging and automobile air conditioning firms, there is a one percent
    chance on a quarterly basis.  Hence, (.01 x 4) - .04.

£/
    Hours for site visits assumes one visit per year to each of the seven
    producers and 14 importers.  Each producer is assumed to have two
    facilities.  Total producer hours, therefore, are multiplied by two to
    represent 14 visits.

S/
    This number assumes that one percent of the packaging firms will be visited.
    (.01 x 100) - 1.

£/
    This number assumes that one percent of the automobile air conditioning
    firms will be visited.  (.01 x 20,000) - 200.

u/
    Number of enforcement actions involving penalties assumes there is a ten
    percent probability that any one producer, importer, packaging firm or
    automobile air conditioning firm will be required to pay a penalty for a
    violation.

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v/ .
    Number of enforcement actions involving litigation assumes there is a five
    percent probability that any one producer, importer, packaging firm or
    automobile air conditioning firm will be involved in litigation regarding a
    violation.

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