US EPA sets new rules for clean air decisions

  • Market: Coal, Electricity, Emissions, Natural gas, Oil products
  • 09/12/20

The US Environmental Protection Agency (EPA) is changing how it evaluates the effectiveness of new clean air rules, a move critics say will hamper future efforts to reduce air pollution and greenhouse gas emissions.

The agency today finalized new rules around how it produces and uses cost-benefit analyses to justify its regulations. The purpose of the new regulation is to increase transparency around the EPA's rulemaking and thereby boost public confidence in the agency's actions, EPA administrator Andrew Wheeler said.

"We will have better regulations that are better accepted from the entire American public," he said as he announced the rules during an event hosted by the Washington, DC-based Heritage Foundation, a conservative think tank.

The new regulations require EPA to focus on the direct benefits in future rulemakings, while also providing the underlying data to justify new regulations. It also requires EPA in future rulemakings to distinguish between domestic and international benefits from emissions reductions.

Environmental groups criticized the regulations as an attempt to make it more difficult for the agency to produce tougher emission standards under the Clean Air Act, something president-elect Joe Biden has promised to do when he takes office.

"It is a massive favor to industry in the final days of this administration and it will cost lives and impact health in vulnerable communities, especially communities of color that traditionally bear the brunt of pollution impacts," League of Conservation Voters board chair and former EPA administrator Carol Browner said.

Wheeler cited the agency's mercury and air toxics standards (MATS) for coal- and oil-fired power plants as a "poster child" for why the change is needed. In that rule, the agency under president Barack Obama estimated benefits of $37bn-$90bn/yr as a result of co-benefits such as reductions in particulate matter emissions.

EPA has since lowered that estimate following a US Supreme Court decision that said the agency did not properly account for the costs to industry when it decided it should issue the MATS rule. The agency, which has kept the standards in place, now says the benefits amount to just $4mn-$6mn/yr, compared with industry compliance costs of $7.4bn-$9.6bn/yr, after accounting for only the direct benefits of lower mercury emissions.

Industry groups including the National Mining Association (NMA) and American Chemistry Council welcomed the EPA announcement, which they said will lead to better decisions from the agency.

"In the past, cost-benefit analysis was improperly used to target the coal industry through unjustifiable regulations that imposed tremendous compliance costs that significantly outweighed the environmental benefits," NMA president Rich Nolan said.

Environmental groups said they hope the Biden administration will move to rescind the regulations, and some have suggested that today's decision may be open to legal challenges.

Wheeler said that while any of his successors could repeal the new cost-benefit regulations. it would be difficult to do so "with a straight face."

"I would hope that they believe in transparency. That's what this regulation is all about," he said.


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