In the News

“EPA has made substantial progress in conducting EJ analysis,” New York University’s Institute for Policy Integrity Executive Director Burçin Ünel, told an Oct. 28 webinar hosted by Resources for the Future (RFF). There are now “a substantial portion of EPA rules [that] actually have quantitative [EJ] analysis,” she added. At the same time, though, Ünel and other researchers say the quality of such analyses may be falling short and urge EPA to expand those analyses in future rulemakings. For example, the results of the upcoming RFF study found that only 66 percent of the EJ analyses for economically significant rules over the last three administrations included a quantitative EJ analysis -- a key metric of their quality, the researchers say. In addition, consideration of the costs of the rules to EJ communities is still “limited,” Ünel says.

Derek Sylvan, strategy director at the Institute for Policy Integrity at New York University, said the tax credits have the potential to drive tremendous emissions cuts with hundreds of billions of dollars in benefits. But many, like the hydrogen credit, have the potential to be skewed in favor of fossil fuels or other polluting technologies. “That could be really huge,” Sylvan said. “You could imagine that for any particular tax credit, if that changes and suddenly a lot of funds are going to activities that have pretty limited or even negative climate benefits, that could certainly undermine the climate impacts of the IRA.”

Oil and gas companies and some renewable developers want more leeway in using fossil fuels to power this process, otherwise, they say, hydrogen projects won’t be built at all. But making the regulations too lax would mean some carbon-polluting projects would get the “clean hydrogen” tax credits, says Matt Lifson, an attorney at the Institute for Policy Integrity at NYU School of Law. “From an emissions, climate change perspective, it would not be a good thing,” he said. 

The Institute for Policy Integrity said the "novel approaches" being put forward by the petitioners and the federal government would promote "arbitrary analyses" inconsistent with the long-standing "reasonable foreseability" test required by NEPA, allowing agencies to disregard significant and foreseeable costs even as they tally indirect and uncertain benefits.

The tax credits require guidance issued by the Treasury Department to help define which projects are eligible. In the case of a clean hydrogen tax credit, a Trump administration could issue guidance that would skew the credit toward more polluting fossil fuel projects. For electric vehicles or wind and solar generation, new guidance could restrict how many vehicles or projects qualify for the credits or could simply cast uncertainty over the programs’ future, discouraging private investment. Derek Sylvan, strategy director at the Institute for Policy Integrity at New York University, said the tax credits have the potential to drive tremendous emissions cuts with hundreds of billions of dollars in benefits. But many, like the hydrogen credit, have the potential to be skewed in favor of fossil fuels or other polluting technologies.

“The most important thing about the guidance is that to the extent that it does improve the integrity of carbon credits underlying these derivatives, it could improve integrity in the voluntary carbon market,” said Erin Shortell, legal fellow at the Institute for Policy Integrity at New York University law school.

While the CFTC guidance is the first effort by a U.S. financial regulator to address voluntary carbon markets, some critics have said the agency's action would address only a small part of the global marketplace. "The guidance applies only to a tiny sliver of transactions one step removed from voluntary carbon markets' core," said Erin Shortell, climate risk legal fellow at the Institute of Policy Integrity, a nonprofit think tank at NYU Law School.

An Oct. 16 webinar from the Institute for Policy Integrity (IPI) will discuss whether skepticism of voluntary carbon markets is justified.

Additionally, in Oct. 1 comments submitted on the draft final report, the Institute for Policy Integrity (IPI) at New York University urges the SAB to advise EPA to “distinguish EJ analyses from analyses that characterize distributional effects.” A distributional analysis can provide insight into how costs and benefits may or may not be equitably distributed across populations but do not fully address EJ.

The Climate Superfund has another benefit: It is designed to protect the public from costs being passed on by Big Oil. That’s not just what lawmakers think, it’s what experts think too. According to an analysis by the Institute for Policy Integrity at NYU Law, the public would be protected from costs being passed on. And their conclusion was recently echoed the Nobel Prize-winning economist Joseph Stiglitz,by who makes the case that the Superfund Act will not raise the price of oil on consumers.