In the News

“This does not appear to be any kind of legal violation. A regulated industry is always going to be part of this process,” said Michael Livermore, executive director of the Institute for Policy Integrity at New York University School of Law. The institute helps not-for-profit groups use cost-benefit analysis to advocate for effective government regulations.

“But this is a bad thing for a couple of reasons,” Livermore said. “Why did the DEC only talk to industry and not environmental groups and the impacted communities? If only industry is part of the shaping of the draft regulations, that imbalance has the potential to skew the rules toward industry.”

Today’s lapse drew some criticism. Instead of proposing a rule, EPA “moved the goal post for a fourth time since September,” Edna Ishayik, communications director for the Institute for Policy Integrity at the New York University School of Law, wrote in an email.

The institute sent a letter to EPA today outlining several recommendations on how the rule should be shaped.

“It’s a win for the environment, it’s a win for the natural gas sector, it’s definitely a win for the public,” said Jason Schwartz, legal director for the Institute for Policy Integrity at New York University. It is still relatively unclear how to measure the benefits, said Schwartz. Less work has been done on the costs of methane emissions to society.

Michael Livermore, who directs the Institute for Policy Integrity at New York University’s School of Law, said EPA has a statutory obligation to write existing-source rules for greenhouse gases. He suggested the agency might want to avoid heightened speculation about what form those rules will take so early in the rulemaking process.

“They’re trying to keep the focus on this rule, rather than on the rules that are on the horizon,” he said. Existing-source rules, he said, could take months or years to write.

The EPA’s first ever greenhouse gas standards for new power plants have already prompted a backlash from some in industry. But rather than bow to pressure, the agency should work to increase the net benefits of the rules while lowering compliance costs for businesses. They can achieve this by barring old, dirty coal-fired plants from slipping by the rules and by increasing businesses’ flexibility in adhering to the standards.

THE Environmental Protection Agency’s proposal earlier this week to reduce greenhouse gases from new power plants was hailed by many environmentalists, but unless steps are taken quickly to bring existing plants under the rule, it will create a perverse incentive for companies to keep running older, more heavily polluting power plants. That’s bad economics that could lead to dirtier air.

The proposal would regulate carbon emissions from future power plants but leave existing sources untouched. This is yet another instance in a more than 40-year pattern under the Clean Air Act in which old and outdated technology has avoided new environmental standards. The result is continuing unhealthy levels of pollution.

“To get CCS going, you’d have to have a rule that was so strict you couldn’t even build a natural gas plant, you’d have to move to CCS,” said Michael Livermore, executive director of the Institute for Policy Integrity at the New York University School of Law. “You’d have to make CCS plants cleaner than natural gas.”

“The option of building new, efficient natural gas plants remains a viable alternative for companies that want to construct,” said Jason Schwartz, legal director for the Institute for Policy Integrity at New York University. “They’re allowed to look into the future and use their best judgment and set standards in anticipation of the growth of technology.”

“EPA’s not denying, of course, and they won’t deny, … that there’s going to be costs” from the regulation, said Michael Livermore, executive director of the Institute for Policy Integrity and adjunct professor at New York University School of Law who focuses on cost-benefit analysis. “The question is whether the costs are justified by the benefits.”

But a clear point, he said, is that the industry study is “not a prediction about gasoline” costs.

“It seems unlikely that they’ll be able to pass on 100 percent of their costs,” Livermore said of the oil companies. “If they can just pass along the costs to consumers, then why fight [the new regulations] tooth and nail?

“It’s not the role of EPA to keep every polluting business in the country open,” Livermore said. “It’s actually businesses’ job to comply with environmental regulations at the cheapest possible cost.”

Michael Livermore, executive director of New York University’s Institute for Policy Integrity, called the failure to cover existing plants “a big problem,” noting that the move might encourage utilities to keep operating conventional coal plants operating longer.

“When you want to reduce pollution, you need to go where the pollution is, and that’s existing sources,” he said, adding that when the government grandfathers existing plants and raises the standards for building new ones, “you increase the incentives to keep existing facilities around.”