U.S. Facility Cleanup Costs Mount : Pollution: A presidential advisory group says disposing of wastes on government property will eventually cost $12 billion a year.

The cost to taxpayers of cleaning up pollution at U.S. military bases, weapons factories and other government facilities is expected to more than triple by the end of the decade, the White House reported Friday.

The projection, contained in the annual report of the President’s Council on Environmental Quality, is the latest accounting of the enormous bill facing the country for cleaning up defense-related environmental problems.

The federal budget for environmental cleanup fell substantially during the Ronald Reagan Administration but has increased sharply over the last two years, rising from $1.8 billion during President Bush’s first year in office to an estimated $3.7 billion this year.

By the year 2000, the cleanup cost for government facilities will be more than $12 billion a year, the report estimates, continuing a rapid increase that has made cleanup costs one of the fastest-growing accounts in the federal budget.

The bulk of the projected cost at the turn of the century involves cleanup efforts at defense-related facilities, the report said, but Bush Administration officials said that they could not provide a more detailed breakdown.

With the Pentagon and Energy Department increasingly focusing on their pollution problems, the magnitude of the task has, however, become more clear.

Defense officials, for example, have placed 17,482 polluted sites at 1,855 bases and other installations on the list of areas needing cleanup. The Environmental Protection Agency considers 89 of those installations to be so badly polluted that they have been placed on the national Superfund cleanup priority list. Defense cleanup eventually could cost $200 billion, according to the Pentagon inspector general’s office.

The Energy Department, which builds nuclear weapons for the Pentagon, lists 13 major pollution sites, many with hundreds, or in some cases thousands, of individual polluted areas requiring cleanup. Energy officials estimate that cleaning up their pollution problem will take 30 years, with a total bill as high as $150 billion.

Overall, the report says, the cost to both industry and government for pollution prevention and cleanup now totals about 2% of the gross national product. The total spent on the environment will continue to mount during the 1990s, although the share of GNP going to environmental protection may not increase, depending on the rate of overall economic growth.

Increasingly, the report noted, the cleanup costs will shift from ending water pollution, which for many years has represented the largest share of the nation’s environmental budget, to cleaning hazardous waste sites and other sources of pollution on land.

The Administration, meanwhile, hopes to reduce the cost of pollution control for private industry by adopting more “market-based” regulations, following an approach used last year in the new Clean Air Act, Michael R. Deland, chairman of the Council on Environmental Quality, said at a press conference.

Market strategies for pollution control have been a controversial subject, attracting the support of industry and some environmental groups, which see the approach as more efficient, but drawing opposition from other environmentalists who say that such policies provide opportunities for companies to evade anti-pollution laws.

The overall approach of market-based regulation is to set a goal and then allow companies to find their own way of reaching it, rather than to set a government requirement for a specific control system. For example, under the Clean Air Act, the government set an overall cap on how much sulfur dioxide--a chief cause of acid rain--can be emitted by the electric utility industry.

Because the cap is lower than existing emissions, the utility industry will have to reduce pollution overall. But each individual power plant will still be allowed to emit a certain amount of pollution. If a company can cut its emissions below the allowed amount, it will then be able to sell an “emission allowance” to another company. The idea is to provide an economic incentive to utilities to find low-cost ways of cutting pollution.

This year, as Congress considers updating the Clean Water Act, “we would like to see incorporated in that statute some of the same kinds of market incentives,” Deland said.

Critics of the approach object that companies can abuse such market programs, claiming pollution reductions they do not actually achieve. Deland, however, insisted that careful policing can make the system work.

“Obviously, any market needs to be regulated,” he said.

So far, Deland added, the Administration has not decided whether to submit its own clean water proposal.