ASTM E2137-22
(Guide)Standard Guide for Estimating Monetary Costs and Liabilities for Environmental Matters
Standard Guide for Estimating Monetary Costs and Liabilities for Environmental Matters
SIGNIFICANCE AND USE
4.1 Use—The standard is intended for use on a voluntary basis by an estimator of costs and liabilities for environmental matters. The user may elect to apply this standard for any or all uses outlined in the Purpose. Application of this standard for one use does not compel application of the standard for all or any other use.
4.2 Principles—The following principles are an integral part of this standard and should be used to resolve ambiguity or dispute regarding the interpretation of estimated costs and liabilities for environmental matters.
4.2.1 Framing the Estimate—It is important to understand and document/disclose the framework in which the estimate is being made, including identification of the requestor, estimator and relevant qualifications, purpose of the estimate, audience/user of the estimate, limitations, assumptions, and a description of what constitutes a reliable estimate.
4.2.2 Caution When Repurposing Estimates—The estimator should exercise care when repurposing an estimate generated for one objective and audience. For example, an estimator may use the expected value approach on a given cost and liability, and find that the “financial assurance estimate” uses unique financial assumptions (inflation, discount rate, time horizon) specified by a state regulator, while a “project controls” or “reserve” forecast – for the very same cost and liability -- will use differing financial factors.
4.2.3 Uncertainty Not Eliminated—Even though an estimate of costs and liabilities for environmental matters is prepared in accordance with this standard, uncertainty remains with regard to, among other things, the resolution of contractual, technological, regulatory, legislative, and judicial issues, which could affect the costs and liabilities. However, inherent uncertainty in estimates should not prevent an estimate from being made.
4.2.4 Periodic Review of Assumptions and Estimates—Assumptions underlying estimates should be reviewed, documented and p...
SCOPE
1.1 Purpose—The purpose of this document is to provide a standard guide for good commercial and customary practice in estimating costs and liabilities for environmental matters.2 Many possible uses for estimates of costs and liabilities for environmental matters exist, including but not limited to business decision making and portfolio optimization, due diligence and communications involving acquisitions and divestitures, regulatory requirements, third-party lawsuits, insurance premium calculation and claim settlement, change of property use, revitalization, compliance planning, construction and project control, analysis of remedial alternatives, budgeting, strategic planning, audit defense, financing, and investment analysis by shareholders. The use of estimated costs and liabilities developed in accordance with this standard may be subject to other standards applicable to the matter involved. For example, it is not intended to supersede accounting and actuarial standards. This standard does not address the establishment of reserves or disclosure requirements.
1.2 Objectives—The objective of this standard is to provide guidance on approaches for estimating costs and liabilities for environmental matters.
1.3 This international standard was developed in accordance with internationally recognized principles on standardization established in the Decision on Principles for the Development of International Standards, Guides and Recommendations issued by the World Trade Organization Technical Barriers to Trade (TBT) Committee.
General Information
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This international standard was developed in accordance with internationally recognized principles on standardization established in the Decision on Principles for the
Development of International Standards, Guides and Recommendations issued by the World Trade Organization Technical Barriers to Trade (TBT) Committee.
Designation: E2137 − 22
Standard Guide for
Estimating Monetary Costs and Liabilities for Environmental
1
Matters
This standard is issued under the fixed designation E2137; the number immediately following the designation indicates the year of
original adoption or, in the case of revision, the year of last revision.Anumber in parentheses indicates the year of last reapproval.A
superscript epsilon (´) indicates an editorial change since the last revision or reapproval.
1. Scope E1527PracticeforEnvironmentalSiteAssessments:PhaseI
Environmental Site Assessment Process
1.1 Purpose—The purpose of this document is to provide a
E1739Guide for Risk-Based Corrective Action Applied at
standard guide for good commercial and customary practice in
2 Petroleum Release Sites
estimating costs and liabilities for environmental matters.
E2081Guide for Risk-Based Corrective Action
Many possible uses for estimates of costs and liabilities for
E2091Guide for Use of Activity and Use Limitations,
environmental matters exist, including but not limited to
Including Institutional and Engineering Controls
business decision making and portfolio optimization, due
E2107Practice for Environmental Regulatory Compliance
diligence and communications involving acquisitions and
Audits
divestitures, regulatory requirements, third-party lawsuits, in-
E2150Classification for Life-Cycle Environmental Work
surance premium calculation and claim settlement, change of
Elements—Environmental Cost Element Structure
property use, revitalization, compliance planning, construction
E2173Guide for Disclosure of Environmental Liabilities
and project control, analysis of remedial alternatives,
E2205Guide for Risk-Based Corrective Action for Protec-
budgeting, strategic planning, audit defense, financing, and
tion of Ecological Resources
investment analysis by shareholders. The use of estimated
E2247PracticeforEnvironmentalSiteAssessments:PhaseI
costs and liabilitiesdevelopedinaccordancewiththisstandard
Environmental SiteAssessment Process for Forestland or
may be subject to other standards applicable to the matter
Rural Property
involved.Forexample,itisnotintendedtosupersedeaccount-
E2637Guide for Utilizing the Environmental Cost Element
ing and actuarial standards. This standard does not address the
Structure Presented by Classification
establishment of reserves or disclosure requirements.
E2718GuideforFinancialDisclosuresAttributedtoClimate
1.2 Objectives—The objective of this standard is to provide
Change
guidance on approaches for estimating costs and liabilities for
E3123Guide for Recognition and Derecognition of Envi-
environmental matters.
ronmental Liabilities
1.3 This international standard was developed in accor-
E3228Guide for Environmental Knowledge Management
dance with internationally recognized principles on standard-
ization established in the Decision on Principles for the 3. Terminology
Development of International Standards, Guides and Recom-
3.1 Definitions:
mendations issued by the World Trade Organization Technical
3.1.1 accretion—an increase to the present value of a
Barriers to Trade (TBT) Committee.
liabilitysolelyduetothepassageoftime,normallyayear;also
known as “unwinding the discount.”
3,4
2. Referenced Documents
3.1.2 activity and use limitations (AULs)—legal or physical
2.1 ASTM Standards:
restrictions or limitations on the use of, or access to, a site or
facility to eliminate or minimize potential exposures to chemi-
calsofconcern,ortopreventactivitiesthatcouldinterferewith
1
ThisguideisunderthejurisdictionofASTMCommitteeE50onEnvironmental
theeffectivenessofaresponseaction,toensuremaintenanceof
Assessment, Risk Management and CorrectiveAction and is the direct responsibil-
a condition of “acceptable risk” or “no significant risk” to
ity of Subcommittee E50.05 on Environmental Risk Management.
Current edition approved Oct. 1, 2022. Published December 2022. Originally
human health and the environment. These legal or physical
approved in 2001. Last previous edition approved in 2017 as E2137–17. DOI:
10.1520/E2137-22.
2
For the purposes of this standard, costs and values are defined as monetary
4
estimates. For referenced ASTM standards, visit the ASTM website, www.astm.org, or
3
Appendix X1 includes citations for additional relevant documents and require- contact ASTM Customer Service at service@astm.org. For Annual Book of ASTM
ments from other organizations including FASB, GASB, PCAOB, FASAB, IASB, Standards volume information, refer to the standard’s Document Summary page on
andSEC. the ASTM website.
Copyright © ASTM International, 100 Barr Harbor Drive, PO Box C700, West Conshohocken, PA 19428-2959. United States
1
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...
This document is not an ASTM standard and is intended only to provide the user of an ASTM standard an indication of what changes have been made to the previous version. Because
it may not be technically possible to adequately depict all changes accurately, ASTM recommends that users consult prior editions as appropriate. In all cases only the current version
of the standard as published by ASTM is to be considered the official document.
Designation: E2137 − 17 E2137 − 22
Standard Guide for
Estimating Monetary Costs and Liabilities for Environmental
1
Matters
This standard is issued under the fixed designation E2137; the number immediately following the designation indicates the year of
original adoption or, in the case of revision, the year of last revision. A number in parentheses indicates the year of last reapproval. A
superscript epsilon (´) indicates an editorial change since the last revision or reapproval.
1. Scope
1.1 Purpose—The purpose of this document is to provide a standard guide for good commercial and customary practice in
2
estimating costs and liabilities for environmental matters. Many possible uses for estimates of costs and liabilities for
environmental matters exist, including but not limited to business decision making and portfolio optimization, due diligence and
communications involving acquisitions and divestitures, regulatory requirements, third-party lawsuits, insurance premium
calculation and claim settlement, change of property use, revitalization, compliance planning, construction and project control,
analysis of remedial alternatives, budgeting, strategic planning, audit defense, financing, and investment analysis by shareholders.
The use of estimated costs and liabilities developed in accordance with this standard may be subject to other standards applicable
to the matter involved. For example, it is not intended to supersede accounting and actuarial standards. This standard does not
address the establishment of reserves or disclosure requirements.
1.2 Objectives—The objective of this standard is to provide guidance on approaches for estimating costs and liabilities for
environmental matters.
1.3 This international standard was developed in accordance with internationally recognized principles on standardization
established in the Decision on Principles for the Development of International Standards, Guides and Recommendations issued
by the World Trade Organization Technical Barriers to Trade (TBT) Committee.
3,4
2. Referenced Documents
2.1 ASTM Standards:
E1527 Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process
E1739 Guide for Risk-Based Corrective Action Applied at Petroleum Release Sites
E2081 Guide for Risk-Based Corrective Action
E2091 Guide for Use of Activity and Use Limitations, Including Institutional and Engineering Controls
E2107 Practice for Environmental Regulatory Compliance Audits
E2150 Classification for Life-Cycle Environmental Work Elements—Environmental Cost Element Structure
E2173 Guide for Disclosure of Environmental Liabilities
E2205 Guide for Risk-Based Corrective Action for Protection of Ecological Resources
1
This guide is under the jurisdiction of ASTM Committee E50 on Environmental Assessment, Risk Management and Corrective Action and is the direct responsibility
of Subcommittee E50.05 on Environmental Risk Management.
Current edition approved March 1, 2017Oct. 1, 2022. Published April 2017December 2022. Originally approved in 2001. Last previous edition approved in 20112017 as
E2137 – 06E2137 – 17.(2011). DOI: 10.1520/E2137-17.10.1520/E2137-22.
2
For the purposes of this standard, costs and values are defined as monetary estimates.
3
Appendix X1 includes citations for additional relevant documents and requirements from other organizations including FASB, GASB, PCAOB, FASAB, IASB, and SEC.
4
For referenced ASTM standards, visit the ASTM website, www.astm.org, or contact ASTM Customer Service at service@astm.org. For Annual Book of ASTM Standards
volume information, refer to the standard’s Document Summary page on the ASTM website.
Copyright © ASTM International, 100 Barr Harbor Drive, PO Box C700, West Conshohocken, PA 19428-2959. United States
1
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E2137 − 22
E2247 Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process for Forestland or Rural
Property
E2637 Guide for Utilizing the Environmental Cost Element Structure Presented by Classification
E2718 Guide for Financial Disclosures Attributed to Climate Change
E3123 Guide for Recognition and Derecognition of Environmental Liabilities
E3228 Guide for Environmental Knowledge Management
3. Terminology
3.1 Definitions:
3.1.1 accretion—an increase to the present value of a liability solely due to the passage of time, normally a year; also known as
“unwinding the discount.”
3.1.2 activity and use limitations (AULs)—legal or physical restrictions or limitations on the use of, or ac
...
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