Category Archives: Cost-Effectiveness Analysis

Can Cumulative Impact Analysis Improve Cost-Benefit Analysis?

As frequent readers know, I am a big fan of cost-benefit analysis.  The basic idea is that, when we make a decision to regulate at a certain level, we are by definition deciding that regulating to that level is “worth” the costs that the regulation will impose.  We might as well make such calculations explicitly. 

However, that doesn’t mean that CBA cannot consider the distributional impacts of federal regulations. … More

Will We Ever Stop Overestimating the Cost of Complying with Environmental Regulations?

Earlier this week, Greenwire (subscription required) had an interesting story about the role that EPA’s estimate of the cost to comply with the Mercury and Air Toxics Standards rule played in the politics and judicial review of the rule.  It turned out that compliance costs were much less than originally estimated by EPA – let alone by industry.  Unfortunately, the $9.6 billion price tag originally put on the MATS rule lived on,… More

EPA’s New Cost-Benefit Rule — Are Both Sides Misrepresenting What It Says?

Last week, EPA released its proposed rule regarding Increasing Consistency and Transparency in Considering Benefits and Costs in the Clean Air Act Rulemaking ProcessAs much as I hate to give aid and comfort to this Administration, I have to say that the rule does not herald the end of western civilization.  The biggest controversy surrounding the rule is its impact on consideration of “co-benefits”. … More

Injunctive Relief Is Available Outside the Fenceline

On Monday, District Judge Rodney Sippel ordered sweeping injunctive relief against Ameren Missouri, intended to remedy violations of PSD requirements he had previously identified resulting from upgrades to the Ameren Missouri Rush Island generating plant. 

Notwithstanding the lengthy opinion, most of the Court’s findings are fairly plain vanilla.  Basically, Judge Sippel ordered Ameren Missouri to submit a PSD permit application and he ruled that BACT for control of SO2 emissions at Rush Island required installation of wet flue gas desulfurization equipment.… More

It’s the Externalities, Stupid.

Last week, the Lancet Commission on pollution and public health (free registration required) released a study on the annual costs of pollution.  There’s bound to be argument about the specifics, but it’s difficult to argue with the conclusion that those costs are really, really, big.  The study estimates the annual global welfare loss due to pollution at $4 trillion – $6 trillion.  The Lancet says that this is more than 6% of global economic output. … More

The Latest Executive Order: Any Kind of Consistency Is the Hobgoblin of Little Minds

Make no mistake, the Executive Order signed by President Trump at EPA yesterday is a big deal.  Time will tell whether the Administration’s U-turn on the Obama rules currently in litigation, such as the Clean Power Plan and the rule on fracking on federal lands will make any difference to judicial review of those rules.  There are plenty of states and NGOs ready to step into EPA’s and BLM’s shoes to defend those rules.… More

A Brief Rant on Cost-Effectiveness Analysis

Yesterday, I posted about the 3rd Circuit’s decision to remand EPA’s approval of Pennsylvania’s regional haze SIP.  Although I think that the decision was important and largely unobjectionable, it did get one issue wrong, and it happens to be an issue near and dear to my heart – cost-effectiveness analysis.  I am regularly surprised by the number of people who oppose its use and the number of people who just plain don’t get it. … More

Record Review Means That EPA Must Refer To the Record: The Third Circuit Remands EPA’s Approval of the Pennsylvania Regional Haze SIP

On Tuesday, the 3rd Circuit Court of Appeals remanded EPA’s approval of Pennsylvania’s regional haze hazeSIP.  The decision is a must-read for practitioners.  It decides some important issues and provides important reminders for EPA and the states on how to build a record and how to justify decisions – or not! – based on that record.

Although seen as a defeat for Pennsylvania and the large sources subject to the regional haze rule,… More

Here’s Another Nice Mess: Executive Order 562 Claims Its First Victim

Last Friday, I posted about Governor Baker’s Executive Order 562, which requires cost-benefit analysis, cost effectiveness analysis – and more – before state agencies can promulgate regulations.  It took less than a week before it became clear that EO 562 has real teeth.  Yesterday, MassDEP sent out a one-paragraph notice delaying hearings on its proposed Clean Energy Standard, citing EO 562 as the reason:

MassDEP is postponing the hearings and comment period on the proposed Clean Energy Standard rule until it has completed the reviews required under the recent Executive Order 562.… More

There’s Undoubtedly A New Sheriff in Town in Massachusetts

I have never agreed with those in the environmental community who are opposed to cost-benefit and cost-effectiveness analysis.  Cost-effectiveness analysis just seems a no-brainer to me.  As to cost-benefit analysis, we do it implicitly every time we write a regulation, and I don’t understand the unwillingness to do so explicitly.

All of which serves as burying the lede to Executive Order 562, issued by Governor Baker governor-charlie-baker-300x450this week.  … More

Cement Kiln Operators Better Hope that Their Control Technology Works: D.C. Circuit Vacates EPA’s Affirmative Defense Rule

Last week was hazardous air pollutant regulation week at the D.C. Circuit Court of Appeals. First, as we reported, the Court affirmed EPA’s mercury air toxics rule, determining that EPA need not take cost into account in promulgating rules for electric generating units (EGUs) under § 112(n) of the CAA. On Friday, the Court affirmed the substance of EPA’s revised hazardous air pollutant rules for cement kilns,… More