In the News

WIGGLE ROOM — A report out today from NYU Law School’s Institute for Policy Integrity says the EPA has some leeway for flexibility — and can probably allow trading within industry sectors — when it sets new industry-specific climate rules.

If someone offered you an investment that would pay out $25 for every $1 you paid you would probably take it.

It turns out that investing in clean air generates exactly those returns in health benefits to the American public. The rules that keep our air safe to breathe raked in annual benefits of $1.3 trillion compared to costs of only $53 billion in 2010. Things like avoided doctors’ visits, increased property values, and pollution-related deaths postponed add up to major money in the pockets of families around the country.

Repealing direct ethanol subsidies would help reduce government support of an energy source with many potentially large drawbacks, while making room in the market for emerging, cleaner energy sources.

In the past, investment dollars flowed into ethanol plants in part because protective government policies and subsidies stacked the deck in their favor. It’s harder for promising alternative energy and efficiency technologies to compete for the same investment capital when government is throwing its weight behind more politically favored sectors.

Maximizing net benefits for the American public is the most important factor that the Environmental Protection Agency should consider in deciding whether to delay clean air regulations.

The rules in question would all generate vast benefits to individuals and families. As I’ve mentioned on these pages before, rules like these generate large economic benefits because, as air becomes cleaner, incidences of asthma, heart attacks and other ailments are reduced. Fewer negative health effects mean fewer days taken off of work, fewer doctors’ visits, hospital stays and a smaller chance of untimely death. This all translates into economic value for the American public.

In his vision of an America transitioning away from fossil fuels, Jon Wellinghoff, the chairman of the Federal Energy Regulatory Commission, sees information technology as the basis for tremendous financial and employment opportunities. And with the right policies and incentives, this could happen soon. But in our current political reality, it feels like light years away.

Speaking on the future of American energy in the United States at Princeton recently, Wellinghoff got into the details of the technologies, many sitting on the shelf today, that could change individuals’ use of electricity and fuel — and would change some of how America does business for the better.

The U.S. Senate is debating a series of amendments to diminish or remove the Environmental Protection Agency’s ability to regulate greenhouse gases under the Clean Air Act. Regardless of the outcome there, the conservative assaults on the EPA’s ability to restrict climate-changing emissions are likely to continue, creating uncertainty for a host of other environmental rule-makings.

The American public enjoys tremendous economic benefits from environmental protections. Given this track record of responsible regulation, EPA deserves to have its power to be safeguarded, not stripped away.

Recently, certain members of the U.S. House and Senate have engaged in attempts to hijack measures like the small business reauthorization bill and the appropriations negotiations by attaching amendments and riders that gut EPA’s authority to control greenhouse gas emission. Polluters with distaste for the small rise in the cost of doing business associated with emissions controls have fought alongside certain politicians willing to skew or outright ignore scientific fact, to undermine EPA’s power to move forward with rules requiring emissions reductions.

“This is about elections. It’s about politics. It’s about using this issue as a metaphor to gain points in partisan politics,” said Michael Livermore, the executive director of the Institute for Policy Integrity, a non-partisan advocacy organization that focuses on governmental decision making, and an adjunct professor at New York University School of Law.

If the new analysis of the acid rain programs are any indication, there isn’t necessarily a tension between efficiency and fairness, said Michael Livermore, a law professor at New York University and executive director of the school’s Institute for Policy Integrity. That is promising for market-based efforts, but it is not a guarantee that future cap-and-trade systems will turn out the same way, he said.

“We don’t need to trust in our luck,” Livermore said. “We can design our programs to reduce the risk of hotspots.”

Shortly, the EPA will release proposed rules that reduce toxic emissions, including mercury, from the utility sector. The new controls are likely to continue a long precedent of cost-benefit justified regulations under the Clean Air Act. In fact, a recent retrospective study of the effects of EPA programs implemented after 1990 show tremendous economic benefits (an estimated $2 trillion) versus costs that add up to a fraction of that.