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Mitigating Uncertainty in PFAS Cost-to-Cleanup Estimates

Robert Young and Ned Turner


  • Discusses the two primary factors in which a property’s environmental liability may vary.
  • Provides items to consider when determining potential liabilities associated with PFAS in property transactions or M&A projects.
  • Addresses items to be considered in order to reduce the uncertainty and better quantify cost-to-cleanup estimates for PFAS-impacted properties.
Mitigating Uncertainty in PFAS Cost-to-Cleanup Estimates
krisanapong detraphiphat via Getty Images

PFAS—known in the science community as per- and polyfluoroalkyl substances—have become an increasingly uncertain risk in quantifying environmental liabilities in commercial/industrial property transactions and mergers and acquisitions (M&A). A major consideration when dealing with PFAS are the various and developing federal and state regulatory and technical requirements, and the resulting uncertainties in estimating costs associated with future investigation and remediation activities. How do environmental professionals quantify environmental liability and best mitigate the uncertainty associated with these costs to make the best risk-based decision possible? There are some guideposts to consider when confronting these continually unfolding challenges.

PFAS Cost Uncertainties

PFAS environmental liability has been estimated to range in the tens of billions of dollars nationwide, and a property’s liability may vary widely due to two primary factors: (1) regulatory uncertainty, and (2) environmental remediation uncertainty.

  1. Regulatory uncertainties. An environmental liability exists at a property if contamination is present or likely to be present, and there exists a legal driver to require the environmental cleanup. A property may be at risk of future environmental liabilities due to impending legal drivers requiring environmental cleanup. The U.S. Environmental Protection Agency (EPA) and Congress are currently evaluating whether to designate PFAS constituents as hazardous substances and set enforceable limits in the Safe Drinking Water Act. Certain states, such as New Jersey and New York, have moved forward to establish enforceable drinking water criteria for selected PFAS, and many other states are in the process of establishing similar criteria. The specific PFAS compounds and their enforceable limits will determine the scope and extent to which a property is subject to environmental liabilities. An accurate understanding of ongoing regulatory trends is critical in forecasting future liabilities, despite current regulatory status.
  2. PFAS environmental remediation uncertainties. Assessing environmental liability exposure is largely based on a reliable estimate of future cleanup, closure, and/or disposal costs of environmental contamination. The landscape of PFAS remediation techniques is constantly shifting, with development of new investigation procedures and remediation technologies, which can vary significantly in cost, occurring regularly.

Assessing the Liability and Identifying Sources of Uncertainties

In determining potential liabilities associated with PFAS in property transactions or M&A projects, it is critical that the following items first be considered:

  • Are PFAS likely to be present on the property due to past waste management activities or industrial operations? Answering this question has become an easier task for professionals studying PFAS and there is an abundance of publicly available information on the types of sites and industrial processes that may contain PFAS. However, it is also important to consider the potential impacts of PFAS that may have migrated to a property from nearby sites. PFAS have been demonstrated to travel farther in surface water and groundwater than other common contaminants. Incinerators, landfills, and municipal wastewater treatment plants are just a few types of sites that may contribute PFAS to environmental media in surrounding areas.
  • If PFAS are likely to be present, is there, or will there be in the future, a legal driver requiring environmental cleanup? The regulatory landscape surrounding PFAS is continually developing. Selected states have moved, or are moving forward with, promulgated standards for PFAS, and the landscape will only become more complicated with the new presidential administration. In jurisdictions with no regulatory drivers, PFAS liability becomes part of a larger risk-based decision, with different approaches to address the risks.
  • If PFAS are likely to be present, what are the potential costs for investigating and remediating the PFAS in environmental media? Once the presence of PFAS is suspected, and the current and potential future regulatory framework established, the environmental liability may be quantified with a cost-to-cleanup estimate. However, uncertainties in environmental remediation technologies, regulatory drivers, and their associated costs need to be addressed.

This leaves an important question that needs to be answered: How can the liability be quantified and the uncertainty mitigated when developing cost-to-cleanup estimates for PFAS?

Quantifying the Liability of Sites with PFAS

To estimate the cost-to-cleanup at a given property, experience gained from other legal cases is often used to estimate the cost-to-cleanup of similar properties contaminated by well-known contaminants (for example, petroleum hydrocarbons or tetrachloroethylene and its reductive dechlorination daughter products). However, because PFAS is a family of emerging contaminants, there are limited legal cases and the application of some well understood costs associated with common contaminants at similar sites may not apply. While this is the case, tools exist that allow for the quantification of cost-to-closure estimates at PFAS-impacted properties.

Environmental consultants regularly generate environmental cost-to-cleanup estimates in support of property transactions and M&A, even in instances where there is little to no data on hazardous constituent concentrations in environmental media. Reliable PFAS cost-to-closure estimates may be developed using detailed parametric cost evaluation tools to create detailed and reasonable bottom-up cost estimates. Parametric estimating uses a library of unit costs developed from engineering/environmental sources on investigation and remediation activities. Since PFAS are emerging contaminants, there is a smaller amount of data on investigation and remediation techniques, and, therefore, a smaller library of applicable unit costs. Thus, when providing PFAS cost estimates, understanding the latest developments in PFAS investigation and remediation technologies is critical.

Mitigating PFAS Liability Uncertainties

To reduce the uncertainty and better quantify cost-to-cleanup estimates for PFAS-impacted properties, the following items should be considered.

Professional judgment

Professional judgment will be critical in providing reliable cost-to-cleanup estimates for PFAS. Consultants experienced in characterizing PFAS in the environment and in evaluating treatment technologies for PFAS-contaminated environmental media should be relied upon for conducting these estimates.

Establish and refine the conceptual site model (CSM)

Once the regulatory framework is understood, the cost-to-closure is largely driven by the nature and extent of PFAS contamination, the geological and hydrogeological environment, and the potential human health or ecological receptors of the PFAS. This information is typically documented in a CSM, which can be assembled by an experienced environmental consultant. The CSM helps determine the magnitude of the PFAS issues and focus cost estimate parameters. It is also important because cost-to-closure estimates for small or isolated areas will typically contain a higher level of certainty than estimates for areas where there are multiple sources and several different environmental media (i.e., soil, groundwater, or surface water) that have been impacted. Some uncertainty can be eliminated by refining the CSM through Freedom of Information Act requests for publicly available environmental documentation, conducting a remedial engineering evaluation of existing data, and completing investigations at the property. The time frame of the real estate or M&A deal will impact the extent to which these additional activities can be conducted and the amount of uncertainty that needs to be addressed.

Estimating time-to-cleanup

While the cost-to-closure estimate is dependent on the capital cost of installing a remediation system to treat PFAS, the total cost is highly sensitive to the time required to achieve a No Further Action determination. Annual costs associated with groundwater monitoring and remedial operation and maintenance (O&M) are not negligible, particularly at properties that will be subject to perpetual treatment given the extremely low cleanup standards that are being promulgated by applicable regulatory agencies. Due to a limited history of treating PFAS in soil and groundwater, estimating time-to-cleanup for PFAS is more difficult than estimates for more common contaminants. In such cases, U.S. Department of Defense guidance recommends that the maximum time span for projecting recurring O&M costs is 30 years, unless supported by site-specific circumstances. 

Statistical cost evaluation

Environmental professionals can quantify the uncertainties in cost-to-cleanup estimates for PFAS through statistical evaluation. Multiple cost estimates may be generated, depending on the most likely regulatory outcomes or the most likely remediation scenarios. Statistical evaluation can consist of:

  • A single cost-to-closure estimate, subject to a -30 to +50 percent accuracy range, in accordance with EPA Comprehensive Environmental Response, Compensation, and Liability Act guidance.
  • Triangular probability distributions bounded by three estimates, guided by professional judgment: the low cost, the most likely cost, and the high cost.
  • Monte-Carlo simulation, with thousands of weighted cost-to-closure estimates for varying unknowns.


Understanding and mitigating the uncertainties in cost-to-cleanup estimates for PFAS will aid in the risk-based decision making process associated with property transactions and M&A deals. An important first step is acknowledging that these uncertainties exist. Then, steps can be undertaken to understand the uncertainties and mitigate them to the extent possible.